ASX Internets Soar As Solution 6 Moves On Sausage
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Australian Net stocks soared Monday morning on a wave of Solution 6 (SOH) generated positive sentiment. A 1.71% jump on the US' Nasdaq to 4798.13 Friday also pushed Internets higher Monday.
Stock in accounting software company Solution 6 surged on open after it announced plans to take over Australian Internet software pioneer Sausage Software (SAS) in a 6 for 10 stock swap. The deal values Sausage at $1.6 billion on a fully diluted basis. "The directors of Sausage believe the proposed merger has strong strategic benefits for Sausage, its employees and shareholders," Sausage said in a release to the ASX.
Solution 6 also announced it will purchase Telstra Corp.'s (TLS) eConnect business assets, Telstra's stake in Asia-Pacific joint venture PlesTel and rights to Telstra Financial Management Services for scrip worth Aus $237 million. Telstra now owns approximately 40% of Solution 6 and is entitled to a similar portion of Sausage.
Ted Pretty, managing director of Telstra's convergent business division, has been offered the position of chairman at the new look Solution 6.
Australian ISPs were the other big winners in Monday morning's surge. Access1 (ACC) jumped 10.7%, while Eisa (EIS) added 5.3% to $2.58. Mobile email provider Pocketmail (PKT) jumped 15.5% to 48.5 cents in the morning run.
Still in online broking, Online Trading Systems (OTS), owner of online broker Sharetrade announced the $12 million acquisition of the Australian Clearing Services Ltd group. The purchase will enhance OTS's back office operations, especially in the area of equities settlement. International online giant Charles Schwab plans to use Sharetrade as its vehicle to enter the already crowded online broking market. OTS remains in pre-open, it closed at $3.50 on 7 March.
Not every Internet related stock was jumping Monday morning. Pilbara Mines (PIL) got a severe case of Mondayitis, dropping as much as 93 cents in early trade before clawing back to be only 35.7 cents or 11.1% down to $2.85 at midday. Pilbara Mines has been riding high on its investment in budding broadband provider Request DSL and Request's relationship with networking behemoth Cisco Systems. Investors keen to consolidate profits drove Pilbara lower in morning trade.
Online content provider HWW (HWW) should surge when it comes out of pre-open later today after signing a deal with Optus@Home and Excite@Home to provide Australian movie session times to their subscribers.