2degrees and Orcon to merge into $1.2billion revenue company

Saturday, 1 January 2022

When 2degrees merges with Orcon, the combined company will have 58 stores across the country.

The third and fourth-largest telecoms companies 2degrees and Orcon are to merge in a deal their chief executives say will bring more competition to the market.

Should the deal go ahead, the combined company would have just over 1.5 million mobile customers, and 345,000 fixed line customers, making it the third largest integrated telco behind only Spark and Vodafone.

It would have $1.2billion annual revenue, compared to Spark's revenue in its last financial year of $3.6b.

The deal was struck between Orcon owners Macquarie Asset Management and Aware Super, and Voyage Digital, which is buying 2degrees from Trilogy International Partners and Tesbrit B.V.

* 2degrees says listing on NZX could 'accelerate growth' ahead of 5G launch

* 2degrees proposes to cut its workforce by 10%

The Government is introducing new powers which it says will protect New Zealanders' interests in important assets such as ports and airports, telecommunications and electricity infrastructure.(First published in November 2019)

Voyage is a joint venture owned by Macquarie Asset Management and Aware Super, both of which are based in Australia.

Mark Callander, Orcon chief executive, said: “This is an incredibly exciting day. Both 2degrees and Orcon have a long heritage in the New Zealand market.

“This transaction marks a step change in the New Zealand telecommunications landscape and will establish a stronger player in market, and this will lead to more competition and benefits to end users.”

2degrees chief executive Mark Aue said: “While we finalise the details it will remain business as usual for both teams.

“Our customers will continue to receive the high-quality products, service, and support they are used to.”

While there would be no immediate changes for 2degrees and Orcon customers, in time the two businesses would integrate their services, he said.

The merger is expected to complete in the next six months, subject to approval from regulators.

As the deal involves important infrastructure and overseas buyers, it must be approved by the Overseas Investment Office, a 2degrees spokeswoman confirmed.

The Commerce Commission would also have to approve the deal.