Amaysim acquires Jeenee Mobile, increases recurring subscribers to 698k

Telecommunications provider amaysim (ASX: AYS) has strengthened its recurring mobile subscriber base through the acquisition of Jeenee Communications and its 41,700 subscribers. 

The purchase of the privately-held mobile virtual network operator (MVNO) for total consideration of $7.8 million will take amaysim’s total recurring mobile subscriber base to 698,600 total users with Jeenee customers to be integrated into amaysim over the next six months before Jeenee is wound up. Including As You Go (AYG) subscribers, amaysim has a total subscriber base of 1.03 million with AYG customers generating approximately 5% of mobile revenue. 

“The acquisition of Jeenee is a financially and strategically attractive opportunity that allows amaysim to leverage its revitalised Optus NSA and operating structure to increase shareholder value,” said amaysim CEO and MD, Peter O’Connell. 

“This acquisition further adds to our growing mobile subscriber base, executing on our strategic pillar to grow the mobile business and cement our position as the leading MVNO.”

Over the past 12 months, amaysim has been undergoing corporate changes which has seen the business remodeled to better suit the current telecom environment and customer needs. 

This has seen the closure of their online device store and divestment of broadband customers, focusing solely on mobile services. In doing so, they have trended their mobile plans away from traditional lock-in contracts with a focus on BYO sim-only plans where customers can maximise data usage in lieu of handset expenses. 

Changes were also made by amaysim to pull back on advertising in a marketplace dominated by Telstra, Optus and Vodafone. 

Since securing a new service agreement deal with Optus in May 2019 to access their network, amaysim has been able to reduce the cost of plans and pass on the savings to customers which has seen a notable uptick in recurring subscriber growth. 

The acquisition of Jeenee Communications will be funded from existing cash reserves. 

Shares in amaysim fell to a 52-week low of $0.285 per share in September but have since rebounded in line with subscriber growth. Shares in AMY reached an intra-day high of $0.435 in early morning trade, a rise of 11.5% on the previous day’s close of $0.39.