Question 1

What is the financial risk if the TPG-Vodafone merger is blocked?

Accepted Answer

TPG faces a projected $168 million write-down of spectrum licenses and mobile network assets if the ACCC denies the merger. This potential impairment reflects the stranded value of infrastructure investments predicated on the combined entity's scale.

Question 2

Is the Australian fibre and infrastructure market still expanding?

Accepted Answer

Demand for high-speed connectivity remains at record levels, evidenced by Chorus achieving its highest volume of installations in a six-month period. Infrastructure providers like Megaport are scaling rapidly to meet this need, adding 24 new data centres to their footprint in the first half of the fiscal year.

Question 3

Which tech sub-sectors are delivering the strongest growth?

Accepted Answer

Data services and digital classifieds are outperforming, with Appen recording 119% revenue growth and REA Group increasing NPAT by 20%. In contrast, the wholesale segment shows signs of pressure, as seen in MNF Group’s 49% decline in NPAT over the same period.

Question 4

What does the current M&A climate look like for Australian TMT?

Accepted Answer

Consolidation is accelerating across hardware and software, with Casa Systems offering $1.10 per share for NetComm. This activity is bolstered by international private equity interest, such as Apax Funds' acquisition of Trade Me Group and Wisetech Global’s continued expansion through Systema AS.

Monthly Australian TMT Wrap: February 2019

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