Amcom transaction spurs trading halt


Tier two Australian telco Amcom Telecommunications has put its shares into a trading halt until next week, citing the need to announce a proposed transaction.

The telco did not give any further details, but normally a transaction refers to a merger or acquisition proposal, or a significant change in the the way the company is funded; for example, a major investment in a company’s operations or restructuring of its financial backing.

Investors have long held a particular interest in Amcom as the company holds a substantial stake in fellow telco iiNet. In turn, Telecom New Zealand also holds a substantial stake in iiNet.

This complex and long-running situation has meant that Telecom New Zealand could take a strong position on the Australian market by buying Amcom, as such an acquisition could trigger an automatic takeover of iiNet as well.

“The company requests a one-day trading halt, and envisages making an announcement to the Australian Stock Exchange concerning the proposed transaction prior to the market opening on Monday 8 February 2010, which will end the trading halt,” said Amcom.