Telstra On Solution 6 - Sausage Software Merger
TELSTRA SUPPORTS SOLUTION 6 AND SAUSAGE SOFTWARE MERGER
20 March 2000
Telstra today welcomed the announcement of a proposed merger between Solution 6 and Sausage Software as a landmark development in the growth of the Australian online services and software industry.
Telstra holds an approximately 25% fully diluted interest in Solution 6, the world’s leading provider of IT solutions to professional service firms and innovator in ASP Services. This interest will be increased to approximately 40% on completion of the in-principle agreement reached with Solution 6 for Telstra to sell part of its eBusiness assets, also announced today.
Telstra is also entitled to an approximately 40% interest in Sausage Software which offers internet tools, e-commerce systems, business software and multimedia for small to medium enterprises (SMEs).
On conclusion of the proposed merger and the proposed eBusiness asset sale, Telstra will hold 40% of the merged entity on a fully diluted basis.
Telstra supports the proposed merger which it believes will create a larger more powerful force to operate in its various spheres of business.
Telstra Convergent Business Group Managing Director, Ted Pretty, said: “We are delighted to have the opportunity to participate in the merger of Solution 6 and Sausage Software. In the absence of a better offer, Telstra intends to accept the Solution 6 offer for its shares and its options.”
In addition to being a shareholder in both companies, Telstra has important commercial agreements with both companies designed to develop online service capabilities and products for Telstra and its partners. Telstra looks forward to continuing and expanding those commercial arrangements with the new, combined company as the two companies work together to create the leading suite of online support and software delivery products.
The merger would create:
- Australia’s leading provider of software designed to support and take advantage of the revolution in online services;
- a more effective partner for advancing Telstra’s online services development; and
- the opportunity to capture cost savings and provide more effective and efficient service delivery across an expanding range of products.
“Two companies that separately have led the Australian development of software products are combining to become the undisputed leader in the sector,” Mr Pretty said.
“Telstra is enthusiastic about the new opportunities for Telstra and for Solution 6 which are presented through a unique combination of assets, services and management skills.”
On closing of the e-Business sale transaction and the merger, Telstra will become Solution 6’s largest shareholder.
“We intend to be a long term investor in the company, which would be the focus for Telstra’s activities in the financial services area. The proposed merger is exciting and offers potential value to all shareholders of both companies,” Mr Pretty said.
Full details of the terms of the proposal are contained in the release by Solution 6 made today.
For further information, please contact:
Telstra Corporation Limited
Tel: (02) 8255 2687 or 0407 268 944