Today’s ‘Puls Biznesu’ daily speculates that Novator, owner of the largest stake in Netia (25%) and Netia majority partner in the mobile project P4, is sounding the withdrawal from its investments in Poland. No further details were given.
Our view: The speculation on the possible disposal of Netia shares, primarily to KGHM’ Telefonia Dialog, has been going on for some time, and M&A speculation has been the sole driver of the stock price in the last year or so. Novator is unlikely to fetch a significant valuation premium to their entry price given that Netia is trading 23.6% lower than the price they offered for minorities last year, and the deteriorating company operating fundamentals. We would expect any price reaction from the speculation to be temporary and would look to sell into any strength.
We also note that the news is consistent with news that Novator appears to be winding down its positions in the telecom sector in EMEA, following news that it is also looking to sell its option to buy 65% of Bulgaria Telecom (BTC), its exit from the Czech telecom market, and ongoing exit from the Greek market.