OTE Extends by 1 Month Bid for Bulgaria's Globul Sale

Business | March 19, 2013, Tuesday // 14:53
OTE Extends by 1 Month Bid for Bulgaria's Globul Sale: OTE Extends by 1 Month Bid for Bulgaria's Globul Sale A file photo, dated September 2008, shows Bulgarian mobile operator Globul marking the seventh anniversary since its launch with a party at a restaurant raised 45 meters above the ground in downtown Sofia. Photo by Sofia Photo Agency

OTE, Greece's biggest telecoms operator has extended by a month the deadline for bidders in the sale of its Bulgarian unit, Globul.

OTE expects to receive about EUR 700 M from the deal, the site econ.bg informs, citing Reuters' sources.

Interested buyers include the Turkish Turk Telekom and Turkcell, the Norwegian Telenor, and Deutsche Telekom, which has 40% stake in OTE.

The deadline for the bids was March 18, but it has been extended because some of the candidates needed more time to prepare the required documentation.

OTE announced plans for the sale in 2012 in an attempt to refinance its EUR 1.65 B debt by 2014.

At the beginning of March, Chief Executive Michael Tsamaz, said the company might halt plans to sell Globul as it was not as pressing after the company tapped international markets for financing to pay debts due this year and next.

"The problem we had for refinancing mostly has been solved. The process we have for Globul has not stopped, it continues. However, we have to rethink the situation and reconsider the situation and decide based on the best of the shareholders' interest," Tsamaz told analysts.

Globul accounts for about 7% of OTE's sales and about 9% of earnings before interest, tax, depreciation and amortization (EBITDA).

OTE's chief executive said late last year Globul required a lot of investments, which OTE might not be able to provide, to remain competitive in a cut-throat Bulgarian market where customers are increasingly switching to cheaper services such as pre-paid offers.

In Bulgaria, Globul competes with Telekom Austria Mobiltel and Vivacom, recently acquired by Bulgarian banker Tsvetan Vasilev, and Russia's VTB Bank.

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Tags: Vivacom, Mobiltel, telco, telecom, telecoms, telecommunications, Globul, OTE, Turk Telekom, Turkcell, Telenor, Deutsche Telekom, Michael Tsamaz

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