Private equity firm Cinven has said its planned acquisition of a 72.75% stake in Telekom Slovenije has not been completed, as Slovenia has not yet accepted a recent amendment to the agreement.
Slovenian Sovereign Holding (SDH) announced yesterday that…
Private equity firm Cinven has said its planned acquisition of a 72.75% stake in Telekom Slovenije has not been completed, as Slovenia has not yet accepted a recent amendment to the agreement.
Slovenian Sovereign Holding (SDH) announced yesterday that its supervisory board had approved Cinven’s 20 May offer for the state’s shares in the incumbent. However, SDH noted that the board did not consider amendments submitted on 9 June, since its management board had deemed them unacceptable.
The supervisory board has told the management board to “harmonise” a final version of the agreement with Cinven. This is to be submitted to the supervisory board for final approval before the agreement is signed.
Cinven, the sole bidder for the stake, said in a statement that it considers the amendment – details of which have not been disclosed – an “integral part of the offer”, without which it cannot complete the deal.
“Based on the information received from SDH, where the amendment is not mentioned, Cinven understands that the offer has not been accepted.
“We believe that the proposed amendment is beneficial to all parties as it reduces the risk of a failed transaction and, on the assumption that the Debitel [a local MVNO the incumbent agreed to buy in March] and Macedonia [Telekom Austria and Telekom Slovenije agreed in October 2014 to merge their Macedonian businesses – respectively VIP and One – with TA holding 55% and running the combined group, and TS owning 45% with call and put options to exit in three years] transactions receive the necessary approvals and proceed to completion as envisaged, does not alter the economic terms of the deal.”
TelecomFinance understands that the deal could still complete if SDH decides to accept the amendment. The offer had been valid until 10 June.
Cinven is offering €100 per share plus €15 EUR depending the outcome of current litigation, plus an additional €5 depending on other conditions, according to the local Pop TV. Cinven’s two conditions are ownership of at least 75% of the company, and the exclusion of Macedonian subsidiary One – which it would like to be sold to Telekom Austria – from the deal.
Last month, the firm increased its offer for Telekom Slovenije from €110 to €130 per share in a bid to persuade local authorities to accept it.
The private equity firm’s final offer reportedly consists of an upfront cash payment of €110 per share, an additional payment of €15 per share depending on the outcome of lawsuits facing the operator, and a further €5 per share depending on the company’s performance.
Explaining its bid earlier this year, Cinven said it aimed to “restore the company’s position as a Slovenian champion” by investing in fixed-line and mobile network upgrades, and returning revenue to growth.
The government is advised by Citigroup.
