VOCUS TO SELL NEW ZEALAND BUSINESS
Written on the 23 October 2017 by David Simmons
AUSTRALIA'S fourth largest telco is planning to sell its New Zealand business by the end of June 2018 in a move designed to reduce its debt and provide "strategic options".
Following a review into the potential divestment of non-core assets the company said today in a trading update that it is looking to sell Vocus New Zealand during the current financial year.
The group's Australian Data Centre assets are also up for grabs now that the company has appointed advisers for the sale of those assets.
The New Zealand business is valued at around $400 million, and Vocus (ASX: VOC) will be welcoming an injection of cash, considering the group reported a $1.46 billion annual loss for FY17.
Following the mammoth full year loss, chairman of Vocus, David Spence, stepped down from his position.
The devastating loss was the result of heavy write downs on goodwill for some more recent acquisitions, and resulted in shareholders not seeing a cent in dividends.
The cash reserves might also be useful in the instance a class action law suit goes sour. In September Slater & Gordon announced its investigation into a class action claim against Vocus.
In October, Vocus appointed former M2 boss Vaughan Bowen and former Telstra chairman Bob Mansfield to lead a board tasked with turning around the business.
Shares in Vocus, which owns telco brands Dodo, iPrimus and Commander, saw a boost from this morning's announcement and are currently trading up 1.78 per cent to $2.86.
Business News Australia
Author: David Simmons