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Telenor Eyes Eastern European ExitTelenor Eyes Eastern European Exit

Norwegian operator says it is evaluating 'unsolicited' interest for assets in the region.

Iain Morris

January 26, 2018

2 Min Read
Telenor Eyes Eastern European Exit

Norway's Telenor says it has been approached by a potential buyer of its operations in central and eastern Europe, which cover the markets of Hungary, Bulgaria, Montenegro and Serbia.

The operator said it has begun evaluating the "unsolicited" interest and would not be making any more statements about the possible divestment until it has concluded this review.

The units under consideration accounted for about 9% of Telenor's revenues last year, and 8% of its earnings before interest, tax, depreciation and amortization.

Due to report full-year figures next week, Telenor Group (Nasdaq: TELN) made revenues of 30.7 billion Norwegian kroner ($4 billion) in its third quarter, and reported EBITDA of about NOK13 billion ($1.7 billion).

The subsidiaries in central and eastern Europe all registered year-on-year growth in revenues and profitability in the third quarter, despite fierce competition in saturated telecom markets.

The statement follows reports earlier this month that Telenor was in talks with US investment fund KKR about a €2 billion ($2.5 billion) sale of operations in Bulgaria, Serbia and Montenegro. Those reports indicated that a deal could be expanded to include Hungary.

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KKR was linked with a bid for Telenor's business in Serbia last year, but CEO Sigve Brekke then denied any of the assets in the region were up for sale.

Telenor bought its way into Bulgaria in 2013 when it paid about €717 million ($891 million) for Globul, the local subsidiary of Greek telco OTE, whose majority owner is Germany's Deutsche Telekom.

Like Nordic rival Telia, which today completed the sale of its Georgian subsidiary, Telenor has recently been exiting some markets to focus on bolstering performance at its core businesses. (See Telia Flogs Georgia Biz, Cuts More Jobs.)

It last year sold its Indian business to market leader Bharti Airtel. It also disposed of a 20% stake in emerging markets operator Veon. (See Airtel to Acquire Telenor in India.)

Telenor's statement came at the same time it was revealed to be under investigation in Hungary for alleged collusion with incumbent operator Maygar Telekom, which is controlled by Deutsche Telekom.

The two operators are suspected of illegally cooperating during a frequency auction in 2014. Both have denied any wrongdoing.

— Iain Morris, News Editor, Light Reading

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About the Author(s)

Iain Morris

International Editor

Iain Morris joined Light Reading as News Editor at the start of 2015 -- and we mean, right at the start. His friends and family were still singing Auld Lang Syne as Iain started sourcing New Year's Eve UK mobile network congestion statistics. Prior to boosting Light Reading's UK-based editorial team numbers (he is based in London, south of the river), Iain was a successful freelance writer and editor who had been covering the telecoms sector for the past 15 years. His work has appeared in publications including The Economist (classy!) and The Observer, besides a variety of trade and business journals. He was previously the lead telecoms analyst for the Economist Intelligence Unit, and before that worked as a features editor at Telecommunications magazine. Iain started out in telecoms as an editor at consulting and market-research company Analysys (now Analysys Mason).

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