Adam Internet chairman Greg Hicks remains confident of finalising his $60 million deal with Telstra, despite it remaining in regulatory limbo for almost nine months.
In October 2012 Telstra announced it was buying the Adelaide-based internet service provider in a transaction believed to be worth around $60 million.
But in January Telstra asked for an indefinite suspension of the approval process after rival ISPs and the Australian Competition and Consumer Commission raised competition concerns about the deal.
Mr Hicks told The Australian Financial Review that the process was still under way and that there was no deadline on the deal being approved.
"It's in the ACCC's hands and they still haven't made a determination. The timeline is on hold," he said.
"It's business as usual here and our revenue has increased 17 per cent this year."
A spokesman for Telstra also said the telco was in active talks with the regulator on finalising the acquisition. "We are in discussions with the ACCC on approval of this transaction," he said.
ACCC IS WAITING ON TELSTRA
But a spokesman from the ACCC said the regulator was waiting on Telstra to ask for a restart of the process before proceeding. "The ACCC will update the public register following further discussion with Telstra," he said.
The acquisition would have boosted Telstra's market share in South Australia.
The two-brand strategy is commonly used in the airline industry; two local examples being Qantas's JetStar subsidiary and Virgin's Tiger Airways .
But rival telcos including Vodafone Australia and Perth-based iiNet complained the deal would decrease competition in South Australia.
It is understood that other ISPs would be interested in buying Adam if its current deal falls through. Telstra is also prepared to launch its own low-cost phone and internet brand if corporate regulators reject the deal.
The national broadband network is driving existing telcos to strengthen their branding and marketing campaigns because it will slash the cost of entry for new players.
According to a JPMorgan note about the NBN's impact on the market, a range of non-traditional players will start offering services across Australia.
"Australia Post, in our view, has the right characteristics [to be] a scale player in the NBN market," it said. "Online businesses such as Google and Amazon may see service provision as an extension of their 'tech' brand, an opportunity to promote content and a way to get more data on usage patterns."
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