Hungarian telecom to make firm Slovenia bid

Magyar Telekom MTEL.BU plans to submit a firm bid for a stake in its Slovenian peer, Telekom Slovenia.

Izvor: Reuters

Monday, 17.12.2007.

09:39

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Magyar Telekom MTEL.BU plans to submit a firm bid for a stake in its Slovenian peer, Telekom Slovenia. If successful, it will seek a controlling stake, Chief Executive Christopher Mattheisen said. Hungarian telecom to make firm Slovenia bid Magyar Telekom was shortlisted with six other bidders in October for the acquisition of a 49.13 percent stake in Slovenia's national telecom operator. The deadline for submitting binding bids for Telekom Slovenia is January 4. "We are working hard to submit a bid by the January 4 deadline," Magyar Telekom Chairman and Chief Executive Christopher Mattheisen told business daily Napi Gazdasag in an interview on Monday. He declined comment on pricing but said the acquisition could be the biggest cross-border merger in Hungary to date and after a successful bid, which would be financed primarily from debt, the firm would seek a majority stake in Telekom Slovenia. "Our intention is to gain control over the company in some form," Mattheisen said. He said Magyar Telekom saw healthy growth prospects in the Slovenian mobile and broadband markets, and a successful bid could also extend Magyar Telekom's geographical reach in southeast Europe through Telekom Slovenia's units there. Magyar Telekom currently has units in Macedonia and Montenegro. Mattheisen said the firm may reduce its dividend payout ratio if the acquisition significantly increases its gearing. "I cannot say it precisely but it is likely that the dividend may be reduced. However, in our view, it will not disappear completely," he said. Magyar Telekom targets gearing in a range of 30 to 40 percent. It paid a dividend of 70 forints (USD 0.402) per share on last year's earnings. The firm's shares closed at 937 forints on the Budapest bourse on Friday.

Hungarian telecom to make firm Slovenia bid

Magyar Telekom was shortlisted with six other bidders in October for the acquisition of a 49.13 percent stake in Slovenia's national telecom operator. The deadline for submitting binding bids for Telekom Slovenia is January 4.

"We are working hard to submit a bid by the January 4 deadline," Magyar Telekom Chairman and Chief Executive Christopher Mattheisen told business daily Napi Gazdasag in an interview on Monday.

He declined comment on pricing but said the acquisition could be the biggest cross-border merger in Hungary to date and after a successful bid, which would be financed primarily from debt, the firm would seek a majority stake in Telekom Slovenia.

"Our intention is to gain control over the company in some form," Mattheisen said.

He said Magyar Telekom saw healthy growth prospects in the Slovenian mobile and broadband markets, and a successful bid could also extend Magyar Telekom's geographical reach in southeast Europe through Telekom Slovenia's units there.

Magyar Telekom currently has units in Macedonia and Montenegro.

Mattheisen said the firm may reduce its dividend payout ratio if the acquisition significantly increases its gearing.

"I cannot say it precisely but it is likely that the dividend may be reduced. However, in our view, it will not disappear completely," he said.

Magyar Telekom targets gearing in a range of 30 to 40 percent.

It paid a dividend of 70 forints (USD 0.402) per share on last year's earnings.

The firm's shares closed at 937 forints on the Budapest bourse on Friday.

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