The Vocus and Amcom deal from my point of view should offer a fibre network that will capitalise on the expanding and even defensive nature of telecommunications demand. Ethernet, Dark Fibre and data centers account for more than half of Vocus revenue and has been growing steadily. I think their is a lot of upside in the stock and is at least a strong hold / buy. Just some quick points from the Annual Report:
. In Australia they have over 580km of fibre and some 1000 buildings connected running past another 30,000. The ratio of buildings is expected to grow from 1.8 times as they commence a marketing campaign (see link below). This will fall straight to the bottom line as the infrastructure is already in place and will offer great leverage.
. The NZ FX acquisition will be earnings accretive. The per km cost was cheap and has an amazing ability to increase capacity at very low $ cost values. This will give longevity to their business and provide somewhat of an economic moat against competition.
