Polkomtel Binding bids due in early April (Poland)
Binding bids for Polish mobile operator Polkomtel SA are reportedly due in early April, after which two or three bidders will be selected to conduct due diligence.
According to reports, seven bidders–Polish tycoon Zygmunt Solorz-Zak, Sweden’s TeliaSonera AB, Norway’s Telenor ASA, and four private equity firms–Apax, KKR, Bain Capital, and Providence Equity Partners–are scheduled to meet with Polkomtel’s management on March 21.
Reports added that the bidders won’t be allowed to conduct their own due diligence until after they file this second round of bids and are selected to remain in the process. Until then, they can speak with Polkomtel management and have access to a virtual data room.
Polkomtel is owned by five companies, with the Polish government holding substantial stakes in three of them.
Poland’s largest power group, PGE Polska Grupa Energetyczna SA, holds a 21.85% stake in Polkomtel and is advised by ING Securities; oil refiner PKN Orlen SA holds 24.39% and is advised by Nomura; copper miner KGHM Polska Miedz SA has 24.39% and is advised by Rothschild. Poland’s Treasury owns stakes of 84.99%, 27.52%, and 31.79% in the three companies, respectively.
The remaining shareholders in Polkomtel are U.K.-based telecommunications operator Vodafone Group PLC, which has a 24.39% stake, and is being advised by Goldman Sachs and coal miner Weglokoks SA, which is wholly owned by the Treasury and holds a 4.98% stake.
TDC owners plans stake sale
The private equity owners of TDC have announced plans to raise US$$4.12 billion through an almost simultaneous sale and buy-back of shares at Denmark’s leading telecoms operator.
The share sale is to be launched on December 9 and would generate the first returns for the group of five US and UK private equity groups that bought an 88% stake in TDC five years ago.
When TDC was bought by Blackstone, Permira, Kohlberg Kravis Roberts, Apax Partners and Providence Equity Partners, it was Europe’s biggest leveraged buy-out and provoked an angry reaction from unions and politicians about job cuts at one of Denmark’s biggest employers.
Now the telecoms operator’s private equity owners plan to sell 210 million shares, plus overallotment option for a further 31.5 million shares, at a price between US$8.36 and US$9.96 each.
According to the company, it was also planning to buy back US$1.60 billion of shares at the same price as the share issue, in an offer to expire by December 8.
The private equity groups are set to achieve returns of 2-2.5 times their initial equity investment, including their retained stake of about 55-60%, thanks to rapid debt reduction at the company. They will be subject to a 180-day lock-up on their remaining stakes.
According to Henrik Poulsen, chief executive, TDC would have reduced its leverage from almost six times earnings before interest, tax, depreciation and amortization at the time of its buy-out to only 2.1 times after the share sale and buy-back. TDC is currently overcapitalized and they believe shareholder value will be created by returning capital to our shareholders by way of a share buy-back.
TDC’s profit margin at the level of earnings before interest, tax, depreciation and amortization has increased from 28% in 2004 and 2005 to 41% in the nine months to September 30.
Mr Poulsen added that this company has a leading position in all sections of the Danish market; their revenue has been quite resilient in spite of a challenging macro-environment. TDC’s board planned to recommend a generous dividend policy to distribute 80 to 85% of equity-free cash flow to shareholders.
TDC plans for $2.9 billion share issue
The private equity owners of TDC are set to announce their plans to sell about US$2.9 billion of shares in Denmark’s leading telecoms operator in what will be Europe’s biggest share issue of the year.
The transaction is expected to be announced on Friday which will be completed by next month and would value TDC at about US$12 billion including debt. It would generate the first returns for the group of US and UK private equity groups that bought an 88% stake in the company in a deal five years ago.
When TDC was acquired by Blackstone, Permira, Kohlberg Kravis Roberts, Apax Partners and Providence Equity Partners, it was Europe’s biggest leveraged takeover.
But as per Kurt Bj¶rklund, co-managing partner of Permira and spokesman for the private equity consortium, the fears have been allayed and, as private equity has done elsewhere in Denmark, they have shown their positive impact on the company.
Since the takeover, Mr Bj¶rklund claimed that TDC had increased its operating profit margins, investment in its network, cash generation and customer satisfaction. The private equity groups are set to achieve returns of 2 to 2.5 times their initial equity investment, including their retained stake of about 60%, owing to rapid debt reduction at the company.
US fund buys 16 pct in Indian GSM firm Idea
NEW DELHI, Oct 13 (Reuters) – U.S.-based private equity firm Providence Equity Partners has bought a 16 percent stake in Idea Cellular Ltd., the fifth-ranked Indian mobile services firm, for $400 million, the Economic Times reported on Friday.
Idea Cellular is 98.3 percent owned by the diversified Aditya Birla conglomerate, which also has interests in cement, financial services and commodities. In April, the group had said it would sell about 33 percent in Idea.
No official from the group was available for comment. Providence could not be immediately contacted.
Idea Cellular provides mobile services based on the GSM platform to more than 10 million customers.
Aditya Birla had purchased the entire 48.12 percent held by another Indian business house — the Tatas — in Idea for 44.06 billion Indian rupees ($968 million), valuing Idea at just below $2 billion.
India, Asia’s fourth-largest economy, has seen a spate of telecoms deals over the past two years in part due to liberalised policies and also on expectations for soaring growth.
The booming wireless services market, which has more than 125 million users, is attracting over 5 million new customers each month thanks to rock bottom local mobile call rates. ($1 = 45.5 rupees)
Source- http://today.reuters.com
