Czech-based PPF has announced the signing of an agreement with Emirates Telecommunication Group Company (e& or Etisalat) under which e& will acquire a stake of 50% plus one share in PPF Telecom assets in Bulgaria, Hungary, Serbia and Slovakia.

The deal will have e& pay €2.15bn for the stake in PPF Telecom assets. It is subject to additional earn-out payments of up to €350mn or clawback of up to €75mn depending on meeting financial targets set out by the involved parties.

PPF Telecom will retain its CEO Balesh Sharma and its existing Czech assets – operator O2 Czech Republic and infrastructure company CETIN – will be moved out of PPF Telecom, keeping PPF alone in control.

“The purchase price of up to €2.5bn represents one of the largest ever deals for PPF,” the group’s CEO Jiri Smejc commented in a press release. “I believe that the know-how and experience that PPF has in the region, combined with the global scale of our partner, will enable us to jointly share ambitions for synergies and further growth,” Smejc added.

Smejc also highlighted that PPF retained its Czech telco assets because of the specificities of the home market and PPF’s plans there.

PPF is a dominant player in Czechia, given the combination of controlling telecommunication infrastructure and being one of the three largest operators. EU authorities and local media have repeatedly pointed out that Czechs pay the most for data due to a lack of competition in the domestic market.

Etisalat is 60% owned by the United Arabic Emirates government, and the remaining 40% is traded publicly. The company was founded in 1976 and currently provides services to 155.4mn customers across 16 countries in the Middle East, Asia and Africa.

CEO Hatem Dowidar stated: “e& continues on its path to be a leading global technology group” focusing on “expanding our customer base”, and added that “by combining PPF Telecom’s expertise with our own innovative capabilities, we are poised to establish a major telecommunications presence in Central and Eastern Europe.”

PPF also noted that the “partnership allows PPF Telecom to leverage e&’s expertise in other markets for rolling out top digital, loT & B2B services.” The transaction is expected to close before or during the first quarter of 2024 and is subject to regulatory approvals.

Talks on the cooperation were first reported by Bulgarian weekly Kapital. Last week, PPF released an annual report in which Balesh Sharma described PPF’s plans to focus on “the new ways our network is used”, listing “security products, content and TV products, insurance products, and tomorrow perhaps financial services products.” 

©2023 bne IntelliNews , source Magazine