Australian operator Optus has agreed to sell 100 percent of the shares in its Optus Insurance Services (OIS) unit to Likewize. OIS is a subsidiary of Optus which provides insurance products for mobile phones and tablets to Optus customers. Likewize is a technology protection and support company, providing device protection, repair, and upgrade products.
Under the terms of the agreement, Likewize will service plans for existing Optus insurance customers and be granted the exclusive right over a 15-year period to supply Optus customers with a new range of device replacement and upgrade plans, which is expected to provide an ongoing revenue stream for Optus. The arrangement also enables Optus to provide its customers with new and more complete products for device repairs, upgrades and replacements, provided through its partnership Likewize.
The initial cash consideration is AUD 200 million, comprising AUD 35 million upon completion of the OIS share transfer and AUD 165 million upon entering into a strategic partnership that grants Likewize the exclusive right to supply Optus customers with a new range of device replacement and upgrade plans for 15 years.
The consideration paid for entering into the strategic partnership is expected to be earned over the partnership term, in addition to an ongoing revenue stream for Optus based on projections of customer growth and take-up of the new services.
The transaction is expected to complete in the second quarter of the 2022 calendar year, subject to regulatory approval.
