Sweden's Telia stepped up the pace of consolidation among European mobile phone operators on Friday, when it agreed to buy a 51 percent majority stake in NetCom of Norway.
It extended its NKr470-a-share cash bid to other shareholders, valuing Norway's second largest mobile phone operator at NKr22.8bn ($2.6bn). The bid trumps an offer by TeleDanmark, whose NKr310-a-share bid had been rejected by NetCom.
Henning Dyremose, TeleDanmark chief executive, said the company was not prepared to outbid Telia - but nor was it willing to sell its 40 percent NetCom stake to the Swedish operator. "We welcome Telia to NetCom and we believe that together we will create a strong partnership. This will not change our strategy in Norway," he said.
Jan-Ake Kark, Telia chief executive, said the acquisition would strengthen Telia's leading position in the Nordic market, making it the only mobile operator active in all four Nordic countries. The company will gain 750,000 customers, taking its Nordic total to 3.8m, or 28 percent of the market.
Telia has made re-entering Norway a priority after being forced to sell its operations there to meet competition concerns at the time of its planned $50bn merger with Telenor, Norway's state-owned telecommunications group. That merger subsequently collapsed.
Analysts say Telia will now be in a stronger position to bid for one of the four third generation mobile licences which Norway plans to offer for NKr200m each this autumn. Telia, which completed its $8.8bn initial public offering last week, is set to make further acquisitions. It acquired its 51 percent NetCom stake from shareholders, including SEC, the pan-European telecoms group, and Orkla, the Norwegian conglomerate. Terje Christoffersen, NetCom chief executive, said the Swedish company would make NetCom a stronger competitor to Telenor, the Norwegian market leader. Reuters
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