Vienna : Telekom Austria, the country's former state-owned telephone operator, said it has agreed to acquire a 70 percent majority stake in Belarusian Mobile Digital Communication, or MDC, for €730 million (US$1.03 billion).
The Telekom Austria Group went through with long-standing plans to enter the Belarusian market. Austria Telekom AG will buy the stake through a 70-percent holding in the company's full owner, Cyprus-based SB Telecom Ltd., a statement said. The acquisition is subject to approval by the relevant antitrust authorities.
For the remaining 30 per cent Telekom Austria entered into a call and put option for the fourth quarter of 2010 and is expected to pay around 230 million euros. MDC has about 2.8 million customers, giving it a 42-percent share of the fast-growing Belarus mobile telecommunications market.
Boris Nemsic, CEO of Austria Telekom, appeared pleased by the acquisition.
'The acquisition of MDC is the consistent execution of our strategy for profitable growth in Eastern and South-Eastern Europe.
'It offers us an entry to the attractive telecommunication market in Belarus while the terms of the transaction once again underline our disciplined approach to expansion,' Telekom Austria CEO Boris Nemsic said.
Austria Telekom said it will finance the 70 percent stake in SB Telecom using existing credit facilities.