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Deutsche Telekom Pays $1.1 Billion for Remainder of T-Mobile Czech Republic

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Germany's Deutsche Telekom has announced that it is paying EUR800 million (USD1.1 billion) to buy the remaining nearly 40% of T Mobile Czech Republic that it does not already own.

The shares, equating to 39.23 percent of the company are currently owned by a consortium of investors led by funds managed or advised by private equity group Mid Europa Partners.

The company was origimally founded as a 41:59 joint venture between Deutsche Telekom and Czech Ceske Radiokomunikace in 1996. Deutsche Telekom increased its stake to 60.8% in May 2000 through a capital increase, and in 2002-3 it adopted the T-Mobile brand.

"The acquisition of the remaining shares is a natural step towards optimizing our portfolio and supports our transformation into the leading integrated Pan-European operator," commented Claudia Nemat, Board Member for Europe and Technology at Deutsche Telekom. "The Czech Republic is an important market for Deutsche Telekom due to its size and structure. With the ongoing integration of T-Systems Czech Republic and the planned combination with the Czech operations of GTS Group, T-Mobile Czech Republic is on a clear strategic path to enhance its fixed-line capabilities and foster its market position in B2B."

The company said that the acquisition of the remaining shares enables a simplification of the capital and governance structure of T-Mobile Czech Republic. In addition, the transaction is said to provides financial benefits, such as the savings of annual dividend payments to the minority shareholders and an increase in net profit.

T-Mobile Czech Republic is already fully consolidated by Deutsche Telekom - therefore the transaction will have no impact on Group revenue and EBITDA.

The transaction is not subject to regulatory approvals.

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Tags: deutsche telekom  t-mobile  Czech Republic