Kordia says it is in talks to sell its ISP Orcon. The state owned enterprise has today released the following statement: “Kordia has been in discussions regarding the sale of Orcon with several parties over a number of months. Interest in the business intensified following the announcement of its integration with Kordia in November last year. “Discussions are continuing, and Kordia expects to be able to make a formal announcement in the coming weeks," says a statement from Kordia. “Due to the confidential nature of our discussions, Kordia is not in a position to comment further at this time.” Kordia bought the ISP from entrepreneur Seeby Woodhouse in 2007 for $24.3 million.
It has always run the ISP as a distinct entity, and incoming Kordia NZ CEO Scott Scott Bartlett indicated that the Kordia and Orcon brands wouldn't merge.
“I will never merge these two brands, ever. They stand for different things, they play in different markets, they’ve got strengths and weaknesses that balance each other out, and I will not be the CEO that gets rid of the Orcon brand or visa versa folds the Kordia brand into Orcon."
Kordia, originally the transmission arm of TVNZ, has assets which include broadcasting spectrum, a telco network, an Australian contracting business and an ISP. The SOE faced an uncertain future with the analogue switchover – due for completion at the end of 2013.
In order to ensure its survival, outgoing Kordia Group chief executive Geoff Hunt implemented a five-year strategy 'broadcast to broadband'.
“He came into the job and in week one someone walked into his office and said 'are you aware that the company’s going bust in about 10 years time with analogue switch off' and his job was to turn it around,” Bartlett told sister publication Computerworld last month.
“We will go into analogue switch off not going into negative territory, fall into losses – the New Zealand business continues to be a profitable enterprise and I think Geoff deserves that headline. If you want mission accomplished, that was probably his key hallmark.”
Last year, Kordia disclosed it was undergoing a strategic review and there were persistant industry rumours that Orcon was for sale. But in November Kordia announced Orcon was to be rolled into Kordia Networks. A Kordia NZ CEO and Kordia Australia CEO were appointed and, along with the Chief Financial Officer, they each report separately to the board. The Kordia Group CEO role was disbanded and Hunt will leave the company this month.
The Orcon sale - which according to an article in the NBR is already a done deal - will see further consolidation in the telco industry. In July last year Vodafone bought TelstraClear for $840 million.
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