Telstra pulls Adam Internet deal

Cuts $60 million deal after failing to find approval from the ACCC.

Telstra has pulled its $60 million bid to acquire South Australian budget Internet service provider, Adam Internet.

The move comes after the deal – announced last October – failed to be approved of the Australian Competition and Consumer Commission.

In January, the watchdog listed a number of concerns with the agreement, the foremost being its impact on Australia’s budget internet service provider landscape.

Concerns were raised by the telco’s rivals that it would use Adam Internet to corner the budget ISP market and would therefore have a leading stake in both Australia’s premium and budget internet services market.

In a statement, Telstra chief customer officer Gordon Ballantyne said the telco had to cut the deal after failing to win back the ACCC’s approval before the contractual end date.

“We are very disappointed by this outcome,” Mr Ballantyne said.

“We believe this transaction would have provided real benefit to Australian consumers and would have added new competition into the broadband market.”

The telco is yet to confirm whether it will push forward with its plans to enter the budget ISP market.

Such an agenda could see the telco launch its own separate brand rather than attempt to acquire another company. 

InvestSMART FORUM: Come and meet the team

We're loading up the van and going on tour from April to June, with events on the NSW central & north coast, the QLD mid-north coast and in Perth, Adelaide, Melbourne, Sydney and Canberra. Come and meet the team and take home simple strategies that you can use to build an investment portfolio to weather any storm. Book your spot here.

Want access to our latest research and new buy ideas?

Start a free 15 day trial and gain access to our research, recommendations and market-beating model portfolios.

Sign up for free

Related Articles