Vocus and Amcom enter trading halts

Vocus Communications (ASX: VOC) and Amcom (ASX: AMM) have entered a trading halt as Amcom shareholders prepare to vote about a proposed merger between the two companies.

Vocus took a 10 per cent stake in Amcom in October 2014. In December, it announced it would seek to acquire the remaining 90 per cent of Amcom.

The two companies have entered into a scheme implementation agreement. If approved by Amcom shareholders, they will receive 0.4614 Vocus shares for each Amcom share held. This works out to $2.45 per Amcom share.

However, in April this year, TPG announced it would vote against Vocus’ acquisition of Amcom. TPG is a long standing shareholder of Amcom and recently increased its equity interest in Amcom to 19.99 per cent.

“TPG supports the continued operation of Amcom as a standalone business under the stewardship of the current board of directors and management team,” TPG’s statement said.

Vocus retorted that it remained committed to acquiring Amcom.

“As stated in the past, Amcom and Vocus are highly complementary businesses and the Amcom Board continues to recommend that shareholders vote in favour of the [Scheme of Arrangement] in the absence of a superior proposal.”

Vocus will “continue to pursue a successful conclusion to the merger with Amcom and will update shareholders as appropriate”.

In May, Vocus sold its 10 per cent interest in Amcom to give the merger the best chance of success.

"The scheme continues to receive extremely broad support from both retail and institutional investors. The only publicly stated opposition comes from TPG which we believe to be acting in its sole commercial interest, to the detriment of the majority of Amcom shareholders," said Vocus CEO James Spenceley.

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