GTS - Aliatel merger poses no threat to Cesky Telecom

GTS won a tender for Aliatel for a reported CZK 1.8bn. The acquisition is going to create the largest alternative fixed line operator in the country. We estimate that the combined fixed line market share would be around 12% compared to CT’s projected fixed line market share of 76% in 2005. Hence we do not expect the merger to pose a threat to CT. In addition, the market liberalization has already taken place and the market of SMEs (the most lucrative customers for alternative operators) is already divided.

In other news, Eurotel, CT’s 100% mobile subsidiary, is going to launch a Push-to-Talk service after the New Year.

Tomáš Gatěk, Patria Finance