Major changes are under way in Romania, with the focus very much on the incumbent telco’s upcoming sale.
Telekom Romania was effectively put on the market in April, when Greece’s OTE decided to increase the share capital of the telco’s mobile arm TMRC, formerly known as Cosmote, by €800 million. This waived TMRC’s debt, which previously prevented the merger of OTE’s operations in Romania, and paved the way for the sale of OTE’s 70% stake in Telekom Romania.
Although OTE’s owner Deutsche Telekom was reported to be interested in a quick sale, ideally by the end of the summer, this failed to materialise. Matters have also not been helped by changes in Romania’s political landscape, with the country currently finding itself with a transitional government ahead of elections next year.
Yet despite this, several potential buyers were quick to emerge. The two favourites were, and probably still remain, Orange and RCS&RDS (Digi), while the Bulgarian entrepreneur Spas Roussev, who recently sold Vivacom to BC Partners-owned United Group, also threw his hat into the ring.
More recently it has been reported that both United Group and the Czech Republic’s PPF Group have held discussions about acquiring Telekom Romania. They took place in Bucharest and involved the ambassadors of Germany, Greece and the US.
The major sticking point, at least as far as Orange and Digi are concerned, is that they are only interested in acquiring some of Telekom Romania’s assets. These would complement their existing ones, with Orange a leading mobile operator and Digi the country’s main provider of cable and fixed internet services.
In the meantime, Telekom Romania’s CEO has had his mandate extended by a year and the company saw a 7.4% year-on-year increase in its revenues in the third quarter. It nevertheless continues to lose both TV and broadband customers as its sale draws nearer.
