Tuesday, July 23, 2013

Telefónica Agrees to Acquire E-Plus Germany from KPN

Telefónica announced plans to acquire KPN’s German subsidiary, E-Plus, for 5 billion euros in cash and a stake in the resulting company of 17.6%.  Telefónica said it will finance 4.14 billion euros of the cash payment.

Under the deal, Telefónica would end up holding a final 65% stake in the new company, KPN will have 17.6% and the remaining shares will be free float.

If approved by regulators, the deal would make Telefónica the second largest European operator by number of mobile customers and volume of revenue.  It would also improve Telefónica's growth and cash generation profile.

Eelco Blok, CEO of KPN, stated "the opportunity to unlock significant value in Germany by selling E-Plus is clear and compelling. The significant premium embedded in the sale price recognizes the substantial operational synergies. The combination of E-Plus and Telefónica Deutschland will establish a mobile operator with attractive synergy and growth potential in Europe’s largest economy. KPN Group post the sale of E-Plus will focus on its core geographies.”

Thorsten Dirks, CEO of E-Plus, said "in Germany we are implementing the next phase of our strategy towards a data-centric Challenger, which already resulted in strong postpaid net adds and data growth in the first half of 2013. I can assure you that we will remain fully focused on executing our operational strategy and will be committed to our customers and employees."


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