Hutchison to buy Orange Austria for US$ 1.7 billion (Hong Kong, Austria)
Hutchison Whampoa has finalized plans to purchase Orange Austria in a bid to enhance its presence in the country. According to reports, the deal valued at US$ 1.7 billion, is an attempt by the operator to increase its market share in the European telecom sector.
As per a statement made by the company, Hutchison Whampoa will divest its assets to Telekom Austria for US$ 514 million. Further, the assets currently owned by Orange Austria include some frequencies, base station sites, intellectual property rights and Orange Austria’s local discount operator Yesss! Telekommunikation GmbH. The transaction is expected to close in mid-2012, and will be financed out of Telekom Austria’s existing cash flow.
According to sources, the deal is beneficial for France Telecom as it enables the operator to concentrate its activities on emerging markets such as Middle East and Africa.
Telekom Austria cuts dividend payout by half (Europe)
Leading telecommunications provider, Telekom Austria, has cut its dividend payout for 2011 and 2012 to half of what it originally planned, owing to the declining European economy. The operator had earlier planned a payout of US$ 1 which has been revised to US$ 0.50 for 2011 and 2012, while the payout for 2013 will be maintained at 55 percent of the cash flow.
As per company reports, the operator has said that this move is the result of an adverse economic condition along with the ever changing foreign exchange market. Further, the operator also expects the upcoming spectrum auctions to have a significant impact on the company’s cash flow. Telekom Austria has said that the maintaining a stable investment grade rating of ‘BBB’ remains the key parameter for the company’s cash use policy.
As reported by Wireless Federation earlier, Spanish telecom giant, Telefonica, had cut down its dividend forecast for 2012 by 14 percent based on the extensive changes witnessed in the market conditions. According to reports by the company, the payout has been reduced to US$ 1.95 a share as compared to the earlier forecast of US$ 2.27 a share.
Ronny Pecik increases stake in Telekom Austria to 15.8 percent (Europe)
Ronny Pecik’s RPR Privatstiftung has reportedly increased its stake in Telekom Austria to 15.8 percent with the help of shares and options. According to reports, Telekom Austria announced that RPR Privatstiftung had exercised options to buy a 15 percent stake in the telecom operator via Marathon Zwei Beteiligungs GmbH, and further holds options to increase its stake by a further 0.8 percent via its subsidiary, Everest Investment GmbH subsidiary.
As per industry sources, Pecik’s stake is currently worth $ 761 million, and is reportedly planning to hike its stake to 20 percent in collaboration with three more investors. However, as per sources, industry analysts claim that Pecik’s decision does not seem to be a very viable one. Further, there have been speculations suggesting that Pecik may be reselling his stake to VimpelCom, Telefonica, Telenor as a means of an exit strategy.
VimpelCom and Turkcell may receive Pecik’s stake in Telekom Austria
According to reports, Austrian investor Ronny Pecik, may sell his 20% stake in Telekom Austria, to telecommunications company VimpelCom and Turkcell. As per sources, Hannes Ametsreiter, CEO, Telekom Austria said that according to Austrian law, investors are only required to disclose stake holdings of 5%. In the event that the investors raise their stake further, they are not obligated to disclose it.
Sources claim that Pecik plans to sell the stake over the next few years to VimpelCom in an attempt to make a 30% profit on his initial investment. Further, reports suggest that Pecik also aims to become a board member of Telekom Austria. As per reports, Telekom Austria said last week that Vienna-based Privatstiftung, which belongs to Pecik had acquired call options on 5.4% of the company’s shares. Further, the deals made by Pecik and his partners are being reviewed by Austria’s financial markets supervisory agency, to check if they are in violation of any shareholding-notification requirements.
Telekom Austria places sole bid for Telekom Srbija stake
Telekom Austria Group has submitted a conditional bid in the region of US$1.13-1.35 billion for the Serbian government’s planned sale of a 51% stake in the country’s incumbent operator, Telekom Srbija. The government however has set an unconditional minimum price of US$1.99 billion for a 51% stake.
If reports are to be believed, Telekom Austria is the only bidder for the stake in the company.
Telekom Austria Group added that the offer is, amongst others, also conditional to merger control clearance in Serbia resulting in a market consolidation. In addition, this offer is subject to negotiations with the government about certain value creating conditions that will result in an expected enterprise value/adjusted EBITDA 2011 multiple of approximately 4.8x.
Additionally, the Telekom Austria Group committed to capital expenditures of US$639.76 million within a three year horizon. These investments are part of the business plan which forms the basis of the above mentioned valuation.
Sale of Telekom Srbija may be cancelled (Serbia)
The government officials have stated that Serbia may decide not to sell a 51% stake in Telekom Srbija if bidders offer less than the minimum price of US$1.9 billion.
According to the officials, they will not sell it at any cost. If offers are below minimum price then they will say that the tender had failed.
Four firms are seen as expected bidders in the sale, for which Belgrade has set 21 March as a deadline for binding bids.
The official added that Deutsche Telekom, Telekom Austria, VimpelCom and Weather Investments would be likely bidders. France Telecom has already left, while America Movil and Turkcell are almost certain to pull out.
Turkcell and France Telecom have stated that they would not be bidding as the prices are too high.
MTS in merger talks with unnamed companies (Russia)
Russia’s MTS has confirmed that the company is in talks with other telecoms networks for a possible merger, without naming any of the potential partners.
Vladimir Yevtushenkov, the CEO of MTS’s controlling shareholder, Sistema confirmed the talks.
MTS chief executive Mikhail Shamolin had previously suggested that the company would be interested in buying out South Korea based Korea Telecom’s 80% stake in Russia-focused New Telephone Co., but that would not give the company the international scope it has long craved.
Last year, it was rumored that the Sistema Group was looking to buy the Telekom Austria Group in a deal worth in excess of US$6 billion. The Austrian state owned holding company, OeIAG holds 27% of the company, and previously looked to sell the stake.
Telekom Austria has operations in Austria, Bulgaria, Croatia, Slovenia, Liechtenstein, Serbia, Macedonia, Belarus and Czech Republic. MTS also operates in Belarus, and the local government would almost certainly require that MTS sells one of its two networks in the country if it were to buy Telekom Austria.
MTS and its subsidiaries in Armenia, Belarus, Ukraine and Uzbekistan currently have over 108 million subscribers.
OTE to sell Its 20% stake in Telekom Srbja
Serbian press reported that Hellenic Telecommunications decided to sell its 20% stake in Telekom Srbja, according to Proton Bank.
In its morning report, Proton says that Serbian government stated that it could sell a 31% stake in the operator instead of 51%, if OTE was to sell its stake.
The starting price was set at EUR1.4bn for the 51% stake, implying EUR2.7bn for the whole company and EUR549mn for 20% stake owned by OTE.
France Telecom is not expected to place a bid as the price is considered too high, while Vimpelcom decided to make an offer, according to the reports.
Additionally, Telekom Austria, DT, Turkcell, America Movil, and Weather Investments have also applied to participate in the tender.
The deadline for the submission of bids is set on March 21.
Serbia extends Telekom Serbia deadline to March
The Serbian Ministry of Finance working group for the privatization of 51% of shares in national telecommunications provider Telekom Serbia has extended the deadline for submitting binding bids until March 31.
According to the Ministry, the deadline was pushed so that France Telecom and Deutsche Telekom, as well as all other interested companies, will have enough time to study the tender documents and make the best quality bids for the privatization of one part of Telekom Serbia.
The Finance Ministry announced that the deadline was extended in order to give more time to France Telecom, Deutsche Telekom and other participants to study the tender documents.
The Serbian government set on December 24, 2010 a minimum starting price to US$1.86 billion.
The government instructed the Finance Ministry and its working group to notify all participants in the Telekom privatization tender about the starting price.
Seven companies Deutsche Telekom, France Telecom, Telekom Austria, America Mobile, Weather Investments Turkcell and VimpelCom, have so far bought the tender documents.
The tender for the sale of Telekom was called on October 20, 2010 and the initial deadline for placing binding offers was February 21. The government will schedule a public auction after the deadline has expired.
Telekom Austria’s VIPnet sees Metronet, other altnets (Croatia)
Telekom Austria is reportedly interested in buying Croatian corporate-focused broadband operator Metronet and may pay a high two-digit million euro price for the company.
According to reports, negotiations between Telekom Austria’s Croatian cellular unit VIPnet and Metronet are at a very advanced stage, although according to spokesperson for the Austrian the company don’t comment on market rumors.
Meanwhile the reports added that VIPnet is also lining up bids for any one of three other alternative telecoms operators in the country, namely unbundled local loop-based operators Optima Telekom and H1 Telekom as well as cableco B.net.
