Singapore Telecommunications' Australian challenger brand Amaysim will acquire 150,000 local mobile subscribers from virtual network operator Circles Life in a move that is expected to be earnings accretive.
Amaysim announced the acquisition Tuesday without disclosing financial details. Vice President Vir Nath said that no assets are involved and that the deal will be earnings accretive to Optus, the Singtel-owned Australian company that acquired Amaysim in 2020.
Singapore-based Circles currently pays Optus for the capacity to operate its virtual network in Australia. Amaysim, which was an Australia-listed virtual network operator prior to its acquisition, uses the same infrastructure.
"The incremental costs of serving these customers are pretty low," Nath said.
Nath said Circles Life would cease to operate in Australia. Most Circles Life users will migrate to Amaysim-branded services by mid-May, he added.
Circles Life owner Circles, which is backed by private-equity firms including Warburg Pincus, didn't immediately respond to a request for comment. In a blog post, it said the deal showcased what it called its build-operate-transfer expertise.
"Circles looks forward to fostering similar transformations in other markets," according to the post. Circles operates in countries including Singapore and last month announced plans to enter North America in 2025.
This transaction is the latest showing how the Australian telecommunications sector is responding to consumers' cost-of-living pressures and shift toward heavy data usage.
Operating second-tier brands with no immediately obvious connection to their owners helps providers reduce churn rates and maintain growth.
Last month, Telstra Group, Australia's largest telecommunications provider ahead of Optus and third-placed TPG Telecom, agreed to pay the equivalent of about US$63 million for virtual brand Boost Mobile.
Optus added 116,000 new customers in its last fiscal year. Most of those were on so-called prepaid contracts of the sort offered by Amaysim and Boost.
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