(MergerMarket)
Telenor in talks to sell eastern Europe assets - sources
Norway-based telecommunications group Telenor [STO:TELO] is in one-to-one talks to sell its eastern Europe assets, a source familiar with and three sources briefed on the situation said.
The negotiations are at an advanced stage, with the buyer conducting due diligence, the source familiar and the first source briefed said.
As a rule, Telenor never comments on speculation and rumours, a Telenor spokesperson said.
The buyer is an unnamed US-based fund, the source familiar, and the first and second sources briefed said. The fund is a new investor to the region, the first source briefed added. The buyer is not KKR [NYSE:KKR], the source familiar and the first two sources briefed said.
The buyer is an unnamed US-based fund, the source familiar, and the first and second sources briefed said. The fund is a new investor to the region, the first source briefed added. The buyer is not KKR [NYSE:KKR], the source familiar and the first two sources briefed said.
In June 2017, Reuters cited Telenor’s Chief Executive Sigve Brekke as saying that the company had no plan to sell its portfolio in central and eastern Europe on the back of press reports suggesting that Telenor was considering selling its Serbian unit to KKR.
The sale comprises Telenor's assets in Bulgaria, Serbia and Montenegro, and is expected to fetch around EUR 2bn, the first and third sources briefed said. According to the source familiar and the second source briefed, the deal could also include Telenor’s Hungarian business.
There are different buyers for the assets individually, but Telenor would prefer to sell them all together, the first and third source briefed said, without elaborating further.
Discussions between KKR and Telenor stalled on mis-matched price expectations, a source briefed on those earlier talks said.
The sale comprises Telenor's assets in Bulgaria, Serbia and Montenegro, and is expected to fetch around EUR 2bn, the first and third sources briefed said. According to the source familiar and the second source briefed, the deal could also include Telenor’s Hungarian business.
There are different buyers for the assets individually, but Telenor would prefer to sell them all together, the first and third source briefed said, without elaborating further.
Discussions between KKR and Telenor stalled on mis-matched price expectations, a source briefed on those earlier talks said.
However, the move would definitely make sense for KKR, which owns Serbia-headquartered cable operator United Group, the same source said, adding that buying Telenor’s Bulgarian, Serbian and Montenegrin assets would enable KKR to create a very large and strong regional player. While the Hungarian business would not make sense for KKR, the sponsor could even buy all the assets together and sell the Hungarian business after the deal is closed, the same source said.
KKR did not return requests for comment.
Telenor Hungary had revenues of NOK 3.4bn (EUR 353m) and EBITDA of NOK 1.2bn in the first nine months of 2017. In the same period, Telenor Bulgaria had revenues of NOK 2.3bn and EBITDA of NOK 903m, and Telenor Serbia and Montenegro combined had revenues of NOK 2.9bn and EBITDA of NOK 1.1bn, according to Telenor’s 3Q17 interim report.
Telenor has a NOK 285.5bn market capitalisation.