Centrica linked to bid for One.Tel UK

Centrica has been restructuring its business, adding telecoms to its gas and electricity services and One.Tel’s customer base is seen by some as a way for Centrica to expand internationally, and grow its own 400,000 mostly fixed-line customers.

No agreement has yet been reached between One.Tel and Centrica, formerly known as British Gas, and other bidders were still being considered, according to reports in today’s FT.

Back in Australia, a court has ordered that assets valued at $23m belonging to One.Tel founders Jodee Rich and Brad Keeling and finance director Mark Silbermann be frozen.

One.Tel was set up by the sons of media tycoons Rupert Murdoch and Kerry Packer, who together invested A$900m into the telecom giant in 1995.

However, a due diligence investigation by One.Tel’s auditor Ernst & Young found a planned rights issue of $132m (Pounds 92m) would fail to keep the company solvent, and could, therefore, not proceed.

Administrators have stepped in, trading of One.Tel shares on the Australian Stock Exchange have been suspended and the business is up for sale.

Lachlan Murdoch and James Packer, sons of the moguls, claimed to have been ‘profoundly misled’ about the financial state of the company while reports in the Australian papers suggest their fathers’ may take legal action against Rich and Keeling, after being outraged by One.Tel’s collapse.

And yesterday Nasdaq-listed telecom Primus Telecommunications Group said it would not purchase the mobile network after a spokesperson for the Australian arm of Primus last week said the company was still considering the possibility of purchasing the network.

Analysts expect the network to sell at a steep discount to the $600 million already spent on the company.

But a spokesperson for Centrica told Accountancy Age it was not company policy to comment on such matters, and dismissed the rumours as ‘pure speculation’.

Links

E&Y report sends One.Tel into administration