U.K. private equity firm Cinven has confirmed it made an offer for Telekom Slovenije and has pledged to invest in the incumbent’s networks and operations.
The company did not put a figure on precisely how much money it intends to spend, but said it will substantially increase investment in Telekom Slovenije’s fibre network to offer high-speed fixed broadband, and will extend the operator’s 4G coverage to 90% of the population.
"Telekom Slovenije is a company that Cinven can help prosper and make more competitive in the future. We intend to restore Telekom Solvenije’s position in the market through significant investment," said Cinven partner Nicolas Paulmier, in a statement issued on Thursday.
"We intend to invest in the development of the company’s telecommunications infrastructure and network to deliver the highest quality broadband fixed and mobile networks for Slovenian citizens and businesses," he said.
Cinven also pledged to invest in Telekom Slovenije’s sales channels and customer service operations, and to optimise processes to improve its products and services in order to reverse its sliding market share and revenue.
Telekom Slovenije’s privatisation was thrown into doubt earlier this week when Slovenian Sovereign Holding (SDH), the asset manager handling the sale of the government’s 72.75% stake in the company, disclosed that by Monday’s deadline it had received just one binding offer.
Deutsche Telekom was also a prospective bidder, but dropped out of the running. Sources cited in a Bloomberg report claimed the German incumbent was concerned about the value of the asset, as well as unspecified regulatory issues.
According to local news outlet Finance.si, Cinven made an offer of between €105 and €115 per share, well below Telekom Slovenije’s €128 closing share price on Monday.
Cinven declined to disclose the size of its offer, and instead talked up its telecoms pedigree.
Cinven along with Warburg Pincus facilitated the merger of the three Dutch cable compa nies that led to the creation in 2008 of Ziggo, which became the Netherlands’ largest cable provider. Ziggo made its stock market debut in Amsterdam in 2012; less than a year later Cinven and Warburg exited the company. In 2014, Ziggo was acquired by U.S.-based Liberty Global, which merged it with its Dutch cable operation UPC.
Cinven pulled off a similar move in France also in 2008, merging three cablecos to create Numericable.
"Cinven is a patient and long-term investor," said Cinven on Thursday. "We take a responsible approach to our portfolio companies, their employees, suppliers and the local environment."
Meanwhile, SDH said that together with its financial advisors, it is "in the process of evaluating the binding offer received" for Telekom Slovenije.
Cinven said it hopes to conclude a transaction on mutually agreeable terms.
"In this way, we believe we can support Slovenia’s competitiveness in the region and in Europe, and we can make a long-term success story out of Telekom Slovenije that will showcase the attractiveness of Slovenia to global investors," said Paulmier.
