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Deutsche Telekom is acquiring the 49 per cent stake of Slovak Telekom that it does not already own for a purchase price of €900 million, corresponding to a multiple of 3.8x EV/EBITDA. The shares are currently owned by the National Property Fund of the Slovak Republic.
“As the only operator in Slovakia with quad-play capabilities, Slovak Telekom is a highly attractive asset,” commented Claudia Nemat, Board Member for Europe and Technology at Deutsche Telekom. “It is the market leader in fixed line, fixed broadband and pay-TV, as well as the second largest mobile player in Slovakia. Furthermore, it is the second of our subsidiaries to already offer an all-IP network, and with the recent introduction of its Magenta One converged fixed mobile services continues to be at the forefront of innovation within our Group.”
The acquisition of the remaining shares allows for simplification of the capital and governance structure of Slovak Telekom. In addition, the transaction eliminates the cash leakage from dividend payouts to minority shareholders going forward.
Slovak Telekom is already a fully consolidated subsidiary of Deutsche Telekom. The transaction has no impact on Group revenue and EBITDA. However, the acquisition of the remaining shares leads to an increase in earnings per share attributable to the shareholders of Deutsche Telekom. Under the terms of the agreement, €100 million of the purchase price will be set aside in an escrow account for a specific time period.
The transaction is not subject to regulatory approvals and is expected to be completed in the coming weeks.
Morgan Stanley and Clifford Chance acted as advisors to Deutsche Telekom.