| Fri 5 Oct 2007, 8:05 | | VOX - Vox Telecom - Acquisition Of Certain Assets |
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VOX
VOX
VOX - Vox Telecom - Acquisition Of Certain Assets In Absa Internet Access
("AIA") And Renewal Of Cautionary Announcement
VOX TELECOM LIMITED
(formerly DataPro Group Limited)
(Registration number 1998/016433/06)
("Vox Telecom" or "the Company" or "the Group")
JSE Code: VOX
ISIN Code: ZAE000058061
ACQUISITION OF CERTAIN ASSETS IN ABSA INTERNET ACCESS ("AIA") AND RENEWAL OF
CAUTIONARY ANNOUNCEMENT
1. Introduction
The board of directors of Vox Telecom ("Vox") are pleased to advise shareholders
of Vox Telecom ("Vox Shareholders") that the Company has entered into a binding
agreement, through its wholly owned subsidiary, Atlantic Internet Services
(Proprietary) Limited ("Atlantic"), to acquire the customer contracts and
certain computer hardware from Absa Bank Limited ("Absa") with effect from the
closing date, being the latest of 1 December 2007 or 2 days after all the
conditions precedent have been fulfilled ("the AIA Acquisition").
The purchase price for the AIA Acquisition is to be settled by Vox from existing
cash resources. The AIA Acquisition remains subject to the conditions precedent
set out in paragraph 4 below.
2. AIA Overview
AIA was launched in 2001 as a free internet service provider ("ISP"),
exclusively to Absa customers. Some time after AIA`s initial launch it was
decided to terminate the free subscription service and charge a monthly fee for
internet access. Services were also offered and rolled out to non-Absa customers
at this time. The customer take-up for AIA services far exceeded expectations
and the AIA business now represents a meaningful portion of the total consumer
internet access market in South Africa.
AIA currently has over 68,000 active subscribers and offers its customers
internet access by means of analogue, ISDN and ADSL connections. Value added
services to customers include Web Mail, 10 megabytes of Web Space for personal
websites, Anti-spam and 5 e-mail addresses per mailbox.
3. Rationale for the AIA Acquisition
Vox Telecom`s strategy continues to be the establishment of the Company as the
preferred telecommunications alternative to the domestic incumbents, in the
rapidly converging and deregulating industries of voice and data.
The AIA Acquisition is regarded as being significant and strategic for both
Atlantic and Vox, as it will considerably improve the Group`s positioning in the
consumer Internet Service Provider (ISP) market and augment the Group`s consumer
customer base and market share.
Vox intends integrating the AIA customer base into its wholly owned subsidiary
responsible for consumer ISP solutions, namely Atlantic. The addition of AIA`s
customer base will solidify Atlantic`s consumer ISP positioning as the third
largest ISP in this market domestically.
Most significantly, Vox as a trade buyer, is in a distinctive position whereby
it is able to utilise its existing synergistic platform and cost structure to
leverage material, accretive contributions from AIA`s contracted annuity
customer base, without adding materially to Vox`s overall overhead structures.
4. Condition Precedent
The agreement is subject to approval by the Competition Authorities of South
Africa ("CASA") and all other necessary regulatory bodies.
5. Renewal of cautionary announcement and further acquisitions
Further announcements will be made on SENS as soon as the financial effects of
the AIA Acquisition are finalised and all of the conditions precedent have been
fulfilled or waived, as the case may be.
Shareholders are advised that in addition to the AIA Acquisition and further to
the cautionary announcement of 16 August 2007, Vox is currently engaged in an
additional acquisition, which may have a material effect on the price of the
Company`s securities. Accordingly, Vox Shareholders are advised to exercise
caution when dealing in their Vox Telecom securities until such time as further
announcements are made.
Johannesburg
5 October 2007
Designated Advisor Corporate Advisor
Arcay Moela Sponsors
(Proprietary) Limited Metier Advisory (Proprietary) Limited
Date: 05/10/2007 08:05:01 Produced by the JSE SENS Department.
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