Monday 15th April 2013
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Kordia, the state-owned communications company, has sold internet service provider Orcon to a local business group led by Vivid Networks' Warren Hurst.
The price paid in the privatisation has not been disclosed.
The deal closed on Friday, the state-owned enterprise said in a statement today. Buyer interest in the ISP intensified in recent months, and Kordia signalled a pending announcement a month ago. The SOE bought Orcon in 2007 for $24 million.
"Structural changes in the market place mean there are likely to be better opportunities for Orcon with a different owner," chairman David Clarke said. "Orcon played an important role in Kordia's transformation from a broadcast to a broadband business."
Kordia has focussed on new revenue streams after the government decided to free up radio spectrum for newer mobile technology by axing analogue TV in favour of a digital signal. That was initially scheduled for 2015, but was brought forward to kick off last year.
In February, the SOE reported an 11 percent increase in first-half sales to $207.1 million, beating its Statement of Corporate Intent target. Profit shrank 69 percent to $2.2 million in the six months ended Dec. 31, and was flat from a year earlier after stripping out a one-time gain in the 2012 financial year.
Hurst said Orcon is in good shape and he will announce a new chief executive soon, at which time "we will discuss our growth strategy."
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