Tele2 Sells Its Belgian Operations To KPN
STOCKHOLM -(Dow Jones)- Swedish telecommunications operator Tele2, Monday said it has sold its Belgian operations Versatel Belgium and Tele2 Belgium to Dutch telecommunications company Royal KPN for SEK890 million ($129.1 million) as part of its strategy to refocus on the mobile and broadband markets.
In 2006, the Belgian operations generated SEK1.38 billion in revenue, and Tele2 is expected to book a loss of between SEK70 million and SEK90 million following the sale.
Stockholm-based Carnegie analyst Andreas Ekstroem said the deal wasn't a big surprise given KPN's announcement last week that it planned to bid EUR100 million for the operations. "It is a good price given the market environment and it shows Tele2's realignment plan is on track," he said.
He said he expects Tele2 to next look at its operations in Spain and Germany as part of future sales. Ekstroem reiterated his outperform rating. KPN spokesperson Marinus Potman said, "We want to expand the activities of our Belgian subsidiary Base through this acquisition. The customers of Versatel are potential customers for mobile operator Base."
KPN already owns mobile provider Base, Belgium's No. 3 mobile operator. Base recently bought retail chain Allo Telecom to strengthen its distribution network. On July 30 KPN announced it intends to make a cash bid of EUR766 million for information technology services company Getronics, which also has a presence in Belgium.
At 0715 GMT, Tele2 shares trade -0.2% at SEK115.75.
-By Adam Ewing, Dow Jones Newswires; +46 8 545 130 95; adam.ewing@dowjones.com
(END) Dow Jones Newswires
Posted to the site on 20th August 2007
