Telenor becomes the sole owner of Sonofon, acquiring the remaining 46.5% equity interest from BellSouth

December 10, 2003

2 Min Read

COPENHAGEN -- Telenor has today signed a definitive agreement with BellSouth to acquire the remaining 46.5% equity interest in SONOFON. Telenor will pay the equivalent of DKK 3,050 million in cash, which is equivalent to an equity value of DKK 6,559 million. As of September 30, 2003, SONOFON had a net debt of DKK 3,474 million.

"The acquisition is in line with Telenor's strategy. We have said that we will take control wherever possible and financially desirable, and exit operations where we are not able to take control, or do not wish to do so," said Chief Executive Officer of Telenor Mobile, Arve Johansen. "The mobile markets in Scandinavia are increasingly becoming one market, and SONOFON is an important strategic asset for Telenor in this region. The benefits resulting from economies of scale within our home market will be improved with SONOFON as a fully owned subsidiary of Telenor. A strong position in the home market is an important prerequisite for our international operations."

SONOFON is the second largest mobile operator in Denmark with a market share of 24% in terms of subscribers and 27% in terms of revenue. SONOFON holds a particularly strong position in the business segment, and has the highest usage per subscriber. ARPU increased during 2003 despite significant price erosion in the Danish market.

"SONOFON has defended its market position in a highly competitive environment. The company has a dedicated and competent organisation," said President and CEO of Telenor, Jon Fredrik Baksaas. "Telenor believes that there are opportunities for further operational improvements, and we estimate the synergies between Telenor's mobile operations in Scandinavia to be in excess of NOK 1 billion calculated on an NPV basis."

Telenor's credit rating is expected to be unaffected by the acquisition.

The deal is subject to approval by the Danish National IT and Telecom Agency and the European Union, and the transaction is expected to be completed in the first half of 2004.

Telenor ASA

Sonofon Holding A/S

Subscribe and receive the latest news from the industry.
Join 62,000+ members. Yes it's completely free.

You May Also Like