Mobile radio company TeamTalk hopes to buy a Timaru-based rural telco and will pay up to $42 million for the purchase.
NZX-listed TeamTalk announced today it had entered into a conditional sale and purchase agreement to buy Timaru's BayCity Communications
"At our recent AGM in Wellington I advised shareholders that we were looking at buying another business. Today's announcement outlines our intention," TeamTalk's managing director David Ware said.
The purchase will require TeamTalk shareholder's approval and a special meeting will be held in mid-December to discuss the matter.
The upfront purchase price is $31 million and could go up to $42.05 million, depending on BayCity's performance.
In the 12 months to June 2012, BayCity had revenue of $25.4 million and EBITDA of $5.8 million, TeamTalk said in a statement to the NZX.
"TeamTalk is a progressive but cautious business. We have a strong track record of success based on providing excellent customer satisfaction and shareholder value," Ware said.