Zintel in $1.9m buy

Communications company Zintel has reached conditional agreement to buy the business of Cogent Communications for $1.9 million.

The purchase price would be funded from cash reserves and, while further investment would be needed, it was not envisaged any debt funding would be required, Zintel said yesterday.

Its chairman, Nick Gordon, said the combined revenue of Zintel and Cogent, a business telecommunications specialist, was expected to exceed $60 million on an annualised basis.

A total of 250 people would be employed across New Zealand and in Sydney.

It was expected that additional working capital, transitional costs and one-off expenses would have a significant impact on Zintel's profit for the year to the end of March.

But it said the group should have considerably improved growth and profitability in future years.

- NZPA