Deutsche Telekom AG has settled a long-running dispute with France’s Vivendi SA and a Polish corporation over the ownership of Polish mobile network PTC, allowing it to take full control of one of the country’s major operators.
According to Deutsche Telekom, it will pay a total of US$1.9 billion to Vivendi and Poland’s Elektrim under the agreement.
The dispute was focused on a 48% stake in Polish mobile network Polska Telefonia Cyfrowa (PTC) on which Deutsche Telekom claimed that it had exercised a call option in 2005. At that point, it already held 49%.
The agreement will help the German company take 100% ownership of PTC. The company is acquiring the final 3% by taking control of two holding companies owned by Vivendi and Elektrim.
According to Deutsche Telekom, Chief Financial Officer Timotheus Hoettges, the absolute legal certainty that is now recognized by all parties is a clear message regarding PTC’s strategic development and paves the way for the future. The company has untangled the knot.
As per Vivendi, it will receive some US$1.65 billion under the agreement and give up any rights to PTC shares. The deal also will allow Elektrim to exit bankruptcy, with all its creditors being repaid. The agreement is subject to the completion of several legal steps in Poland.
Deutsche Telekom stated that PTC is the third-biggest mobile operator in Poland, by far the largest of the once-communist eastern countries that have joined the European Union over recent years. It operates Cellphone services under the Era brand and has a market share of 29%, only just behind competitors PTK Centertel and Polkomtel.