Austar United Communications will not proceed with its takeover of beleagured Internet service provider eisa after failing to receive sufficient acceptances for its 20 cents a share offer.
Austar said it had acceptances for around 87 percent of eisa's shares by the time its offer closed on Friday, but needed 90 percent to move to compulsory acquisition.
The regional pay-TV firm has a relevant interest of 19.9 percent in eisa, and is entitled to acquire three of its ISPs in Canberra, Cairns and Darwin in satisfaction of a AU$7.5 million short-term loan it provided to the firm. If the cash-strapped ISP is put into administration, Austar -- which bid around AU$24.4 million for eisa -- said it would be interested in picking up more of its assets.
"We're assuming they'll do what they've indicated and appoint an administrator, in which case we'd look to talk to that person," Bruce Meagher, Austar spokesman said.
Eisa went up for sale in June after an ambitious AU$350 million bid for OzEmail's residential business -- owned by Worldcom -- fell apart when it could not raise the required funds and it became clear its cash reserves were running dry.
Eisa, which has around 85,000 subscribers, said last week its first half loss was AU$41.72 million after an abnormal loss of A$25.14 million, related largely to the cost of its failed OzEmail bid.
