Telekom Austria Acquires Bulgaria's Mobiltel

Business | June 1, 2005, Wednesday // 00:00| Views: | Comments: 0

Telekom Austria signed on Wednesday a Share Purchase Agreement for the acquisition of 100% of Bulgarian leading wireless operator Mobiltel AD, valued at up to EUR 1.6 B.

The deal is expected to be finalized in July 2005 instead of in the fourth quarter as the Austrian telecom accelerated its planned purchase of Mobiltel through early exercise of the call option acquired on December 17.

The Enterprise Value of up to EUR 1.6 M remains unchanged, but the call option price of EUR 80 M paid by Telekom Austria in the first quarter of 2005 will be fully creditable against the purchase price, Telekom Austria announced in an official statement.

Mobiltel net debt will be assumed by Telekom Austria. As of June 2004 it totaled EUR 450 M.

The price will also include two deferred contingent payment components of up to EUR 100 M and EUR 182 M.

"The acceleration of the acquisition gives Telekom Austria Group a strategic advantage in Bulgaria and the earlier financial consolidation will have a stronger positive impact on our financial statements" says Heinz Sundt, CEO of Telekom Austria.

Following a number of ownership changes MobilTel assets are currently in the hands of a consortium comprising some of the existing Austrian shareholders of Mobiltel Holding GmbH and seven private equity investors.

The new investors are being led by ABN AMRO Capital, Citigroup Investments Inc. and Communications Venture Partners Limited. The consortium also comprises Sandler Capital Management, Innova Capital, Global Finance and 3TS Venture Partners.

As of 31 March 2005, Mobiltel had 3.14 M subscribers, making it the largest mobile communications operator in Bulgaria with a subscriber market share of approximately 63.9%.

Telekom Austria reported a 64% increase in net profit in the first quarter of the year, up to EUR 115.7 M.
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