Cesky Telecom officially confirmed yesterday’s Financial Times report that AT&T Wireless and Verizon Communications not accepted Cesky Telecom’s bid (USD 1.1 bil.) for the 49% stake in Eurotel, and that a decision by Cesky Telecom should be taken sometime this week as to whether to continue negotiating further or whether to put the acquisition on hold.
The MFDnes newspaper reports today that while the state (51% shareholder in CT) seeks the purchase, TelSource (27% shareholder) insists on a lower acquisition price (MFDnes says in this context that a price of USD 1.2 bil. is “being talked about”). USD 1.2 bil. would be reasonable, in our opinion, but paying more or leaving the issue unresolved could have some negative short-term impact on Cesky Telecom stock. On the other hand, the stock might be supported by the prospect of a privatization tender being launched soon - MFDnes reports today that the National Property Fund may launch the CT privatization tender in the coming days. The HN newspaper quotes Czech Transport Minister J. Schling as saying that an investor memorandum will be issued in the coming days, regardless of whether the Eurotel negotiations continue or not. The Cabinet decided earlier this month that the privatization tender should be completed by the end of March 2002.
Separately, Eurotel announced yesterday that the number of its users exceeded 3.0 mil., and that it now projects 3.2 mil. users by the year’s end. We have been forecasting 3.1 mil. users by the year’s end, but in light of the new figure we will increase our forecast.
(Ondrej Datka)