Central European incumbent Telekom Slovenije is at the center of some interesting M&A action this week, as the hunter and the hunted.

First, the carrier continued its regional expansion program by paying €3.975 million ($5.7 million) for a 75 percent stake in Albania's AOL SP (Albanian Online Service Provider). (See Slovenije Buys Into Albania.)

The price is so small because AOL SP has just 3,000 broadband access customers. This, though, gives the ISP a 75 percent market share of the currently tiny Albanian broadband market, according to the Slovenian operator.

Telekom Slovenije believes the ISP can be a growth engine, as Albania, still hampered by a lack of business and transport infrastructure after only 15 years of democracy, still has a low fixed phone line penetration of fewer than 10 lines for every 100 people in a country estimated to have a population of about 3.6 million people.

But with the Albanian government committed to improving the country's economy, and working toward membership of the European Union, Telekom Slovenije plans to invest €18 million to €20 million ($25.6 million to $28.4 million) in AOL SP during the next five years in the hope of meeting increasing demand for Internet access and VOIP services.

The acquisition is Telekom Slovenije's latest move to make itself a regional player in Central and Eastern Europe, as the carrier already owns assets in Macedonia and Bosnia and Herzegovina, and is building out a mobile network in Kosovo.

But Telekom Slovenije isn't just a hunter in the M&A world, as a dozen companies have submitted offers for the 49 percent stake in the national operator that's being sold by the Slovenian government, which will still hold a 25 percent stake after the divestment.

Slovenia's Economic Ministry announced that 12 companies had submitted non-binding bids by the deadline, which was Monday this week. The dozen include private equity firms The Carlyle Group LLC and Providence Equity Partners , Deutsche Telekom AG (NYSE: DT) subsidiaries Magyar Telekom plc (Hungary) and Hrvatski Telekom (Croatia), and Oger Telecom from the United Arab Emirates.

That group will now go into the second phase, which will involve submitting binding bids once a full due diligence process is completed.

Telekom Slovenije reported an operating profit of €46.3 million ($66 million) from revenues of €380.8 million ($541 million) in the first half of this year. (See Telekom Slovenije Reports H1.)

The carrier also recently began an eight-year program to hook up the majority of Slovenia's households with fiber to provide high bandwidth access for triple-play services, with a planned capital investment of up to €450 million ($639 million) by 2015. (See Slovenia Snacks on Fiber Diet.)

— Ray Le Maistre, International News Editor, Light Reading

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