Australian operator M2 Telecommunications has agreed to acquire ISP People Telecom for a combination of cash and shares. People Telecom shareholders will receive 0.0916 M2 shares and 0.6886 cents in cash per share, plus up to 0.344 cents per share depending on People Telecom's final cash balance. The transaction is valued at a minimum of AUD 0.0546 and a maximum of AUD 0.0581 per share, equal to a premium of over 100 percent on People's share price in the last 30 days. Following the People acquisition, M2 expects to increase its annual revenues to over AUD 250 million and grow EPS by 15-20 percent. The acquisition is expected to be completed in early April 2009. Melbourne-based M2 offers fixed and mobile services in Australia and New Zealand, while People Telecom, based in Sydney, focuses on internet services.
