UK Tesco to take stake in Freshtel
Email Print Normal font Large font December 29, 2005 - 6:19PM
Internet telephony company Freshtel Holdings Ltd has pushed its UK ambitions into top gear after raising nearly $4 million through a share placement to UK retailing giant Tesco.
Freshtel, which makes and sells voice over internet protocol (VoIP) products and services across the world, said that after the placement Tesco will hold six per cent of the company.
The shares issue will raise $3.7 million and Freshtel plans to use the proceeds to further develop its products and services for the UK.
The issue follows a deal between Tesco and the Australian company under which FreshTel will provide it with a branded VoIP telephone services.
"The own brand service will launch in the UK next year and be marketed and distributed through Tesco's existing retail channels," Freshtel said.
Freshtel will provide the network, infrastructure and billing information for the retailer.
It will earn per user licence fees and margins on all calls to a landline or mobile.
Tesco will also pay maintenance fees and Freshtel will earn additional royalties on all hardware purchased by Tesco from Freshtel's manufacturing partners.
Shares in Freshtel, which listed on the Australian Stock Exchange in April this year, ended down half a cent at 43 cents.
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