Page last updated at 10:46 GMT, Wednesday, 1 February 2006

Thus expands through acquisitions

Telecoms equipment
Thus hopes the deals will improve returns

Business telecoms firm Thus has snapped up another telecoms company and an internet service provider in a bid to develop its business.

Thus said it had bought telecoms company Your Communications, which is owned by United Utilities, in a deal worth 58.8m (104m).

The deal will also see United Utilities take a 22.5% share in Thus.

Thus also said it was buying internet service provider Legend in a deal which values the business at 11.5m.

In order to fund the deals, Thus said it would be issuing new shares.

Alternative business network

The acquisition is part of a trend towards consolidation in our industry
Philip Rogerson, Thus chairman

Thus, which provides voice and data services, was demerged from Scottish Power in 1999.

In November it reported flat earnings and said it was seeking acquisition opportunities to boost its value.

Your Communications provides business connections by voice, data and mobile phone, as well as high-speed internet.

The deal will accelerate Thus' existing business plan to create a leading nationwide alternative carrier for business customers.

It believes the purchase will enable it to provide an extended product range to its own and Your Communications customers.

"The acquisition is part of a trend towards consolidation in our industry that, we believe, offers the potential to create a more sustainable industry structure and improve returns," said Philip Rogerson, chairman of Thus.

Greater focus

Legend provides a range of internet services to business customers in the north of England.

Thus said that buying Legend would help to accelerate the growth of its own internet service provider Demon UK by adding a business customer base focused on small and medium sized companies.

Thus added that it was planning to sell its Demon Netherlands business in order to focus on its UK interests.

The firm said that, together, the acquisitions and disposal would create "a stronger, more focused participant in the UK business telecoms market, with the financial resources, scale, product set and customer base to continue the company's growth path".



SEE ALSO
Thus eyes deals as profits stall
21 Nov 05 |  Business
Telecoms firm unveils 36.2m loss
23 May 05 |  Scotland

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