The sale of Canberra's telecommunications company TransACT to Perth company iiNet for $60million was announced formally yesterday.
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The actual change of ownership is expected to occur on or about Wednesday next week.
Despite the change of ownership, TransACT will continue to trade under the same name, at least in the foreseeable future. iiNet's founder and chief executive officer, Michael Malone, said yesterday the name would be retained in the ACT, Geelong, Ballarat and Mildura. It was possible a decision to rationalise to one brand would be taken in two years, but that was not being considered at present.
''TransACT has such a strong position in Canberra. It is a well-known, well-liked brand,'' Mr Malone said.
He also said there was no intention to make anyone redundant, but there could be staff changes within the next two years.
Customers' contracts with TransACT would not change. Neither would contracts bundling services from ActewAGL and TransACT. iiNet and ActewAGL saw value in retaining this arrangement. It was credited with a remarkably low churn of customers from both organisations. The change of ownership has done nothing to remove doubt over how the National Broadband Network will integrate with the TransACT network.
However, Mr Malone and TransACT chief executive Ivan Slavich said it seemed more likely the NBN would service areas of Canberra in which TransACT did not have fibre optic cable.
Mr Slavich said TransACT had the option of laying cable in several Belconnen suburbs in which conduit had been laid. Mr Malone said the decision to buy TransACT had nothing to do with the NBN.
''If you told me the NBN was cancelled yesterday, we would have still bought TransACT.''
TransACT was established about 12 years ago by Actew, an ACT Government-owned corporation. It invested $60million in the venture, which soon ran into financial difficulties as the dot com bubble burst. Other investors were obtained, principally Hong Kong-based TVG private equity group, which now has a 43 per cent interest in TransACT.
iiNet was established about 18 years ago by its now chief executive officer, Mr Malone, in his parents' garage in Perth.
In Melbourne last week Mr Malone was named Ernst & Young 2011 Entrepreneur of the Year.
He said he had begun the business with the sole purpose of connecting himself to the internet.
iiNet is Australia's second largest digital subscriber line broadband provider, employing about 2000 staff.
Actew managing director Mark Sullivan said the sale would leave Actew with a small book profit.