Speculation mounts over Vanco

The future of virtual network operator (VNO) Vanco has come under intense channel speculation after the firm suspended its shares from the London Stock Exchange.

The world’s largest VNO has also parted company with its founder and chief executive, Allen Timpany, after admitting it has limited headroom on its credit facility and that there is “uncertainty” about its 2008 financial results.

Vanco has seen its share price plunge by more than 80 per cent since last August due to fears over its revenue recognition model.

The firm said in a statement it would “examine all available strategic options” during its period of suspension. IBM and
Accenture have been linked to a possible buyout.

However, Keith Humphreys, managing consultant at EuroLAN, said: “It seems odd to speculate that Accenture could be buying it when the majority shareholder [Allen Timpany] has been ousted.

“It would have been easier to negotiate a sale with him in place. This makes me think that maybe Allen is putting together a package to buy it himself.”

Another integrator, who wished to remain anonymous, claimed that Vanco was destined for a “trade sale”.
Barrie Desmond, business development manager at distributor VADition, said Vanco had recognised the value of some managed services contracts upfront while selling them to finance houses.

“I still believe the VNO model has legs. But if you practise that business model even to a certain degree, you have to keep filling the hopper with bigger deals,” Desmond said.

Vanco was unable for comment as CRN went to press.

See also:

Vanco chief blasts investors

Virtual Network Operator head laments 'short termism' of UK financiers  28 Feb 2008

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