TPC CONSOLIDATED LIMITED — M&A Activity 2011

Dec 27, 2011

ASX Release

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Tel.Pacific and gotalk Limited complete merger

• Tel.Pacific and goTalk have now completed the merger announced on 19 December 2011

• 100% of shares in gotalk Limited have now been acquired by Tel.Pacific

• Consideration of $8m in vendor notes (to be paid over three years), and 15% of the enlarged Tel.Pacific equity, has been issued to gotalk shareholders

• Each business has complementary strengths, which will combine to create a more competitive operation in the future

• Work is now underway on the revenue and cost synergies to be realised over the coming year

28 December 2011 : The Board of Tel.Pacific Limited (ASX:TPC) today announced that the Company had completed on its offer to acquire all the outstanding shares in gotalk Limited, to effect a merger between the two companies.

The relevant conditions precedent to the transaction have been met or waived, and Tel.Pacific has now acquired 100% of the shares held in gotalk Limited, with gotalk shareholders receiving the following:

• $8m in Vendor Notes to be paid over three years with a coupon of 7.5 to 10% depending in leverage ratios; together with the issue of Tel.Pacific shares representing 15% of the Company on a fully diluted basis.

• A ‘participating right’ to receive 85% of the proceeds of a future sale of the existing gotalk Wholesale Business (should it be sold by 31 December 2012) – a non-core asset which both parties believe may be worth more in a third party’s hands, but which will provide an excellent addition to the business should it remain within the combined group.

The Board will now invite Steve Picton (gotalk CEO) and Ian Solomon (gotalk CFO) to join the Tel.Pacific Board, providing the Company with a very direct benefit at the highest level of their many years of expertise in the international telephony business. Steve and Ian will also both assist with the integration and transition of the businesses as executive directors for at least the initial period of the merger, and have defined areas of responsibility which will see a great deal of relevant expertise directed immediately to where it can most benefit the combined group.

While gotalk’s 30 June 2011 EBITDA was $601k, with an NPAT loss of ($1,028k), the company has an important presence in the calling card market, as well as in the emerging international pre-paid mobile market. The Tel.Pacific Board believes there is an excellent opportunity here to benefit from each company’s areas of specialisation to strengthen the combined business and to create both cost and revenue synergies.

Tel.Pacific anticipates that many of the identified synergies will be realised within the initial six months, and looks forward to updating the market on progress at the full year result for 30 June 2012 (and, to a more limited extent, at the time of reporting the half year result to 31 December 2011).

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For more information please contact:

Greg McCann, Chair Tel.Pacific +61 2 9805 8010 www.telpacific.com.au

About Tel.Pacific

Established in 1996, Tel.Pacific is a significant participant in the Australian communications market. The Company’s core business centres around the provision of pre-paid telephony products and services through extensive distribution networks.

Since its establishment Tel.Pacific has experienced strong and sustained revenue growth. Tel.Pacific sees continued growth opportunity in its pre-paid calling card business and intends to further expand its business activities in this area as part of its long-term growth strategy.

Tel.Pacific’s core product line comprises more than 30 brands of low cost pre-paid calling cards mainly used for international telephone calls to over 230 countries and regions. The Company’s portfolio includes the well known Hello, Joy and GPS brands.

Tel.Pacific Limited

Media Release

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