Romanian mobile telephony operator Mobifon-Connex might be the object of an ample financial transaction on the international market. Following this deal, the company’s shareholders, both Romanian and foreign persons, would be involved in a complicated equity swap that is a novelty for Romania and that will give rise to discussions.
Thus, the Canadian telecoms group Telesystem International Wireless (TIW), Mobifon main shareholder, announced its intention to reunite operations in the Czech Republic and Romania into a distinct company, ClearWave, headquartered in Holland, that is to be subsequently floated on the foreign capital market and firstly on Nasdaq.
Through this operation, the Canadian operator intends to attract significant funds, aimed at developing its network in the Czech Republic and perhaps at other acquisitions as well.
According to sources close to the transaction, TIW is planning to suggest the other Mobifon investors to accept ClearWave stock in exchange for Mobifon shares.
“They made the right decision, having been supported from the very beginning by all Mobifon stockholders, because it will boost Connex market value enormously, once the company is listed on Nasdaq,” George Copos, owner of Ana group and one of Mobifon stockholders, told Ziarul Financiar.
If the transaction preserves the form of equity swap, the Romanian side sees it as an investment abroad, because it gives up stock in a Romanian legal person in order to receive stock in a foreign company. This means capital export, which has not been liberalised in Romania yet.
Residents’ investments in other countries can only be authorised by NBR. “I cannot comment on such a deal, because I have discussed with no one so far,” said Alexandru Matei, an NBR director.
TIW currently holds 54.7 percent of Mobifon stock, the other significant shareholders being AirTouch Europe, a subsidiary of the largest world phone group Vodafone, which owns 20.1 percent of shares, Chase Capital Partner with 16 percent and RA Posta Romana (Romanian Post Office) with a stake of 5.5 percent. The other shareholders that hold minority stakes are Societatea de Instalatii de Semnalizari (Signalling Installations Company) and Automatizari Feroviare (Rail Automatisation) S.A. with 4.5 percent, Ana Electronic SRL and ANA IMEP with 1 percent.
The Post Office management stated however that the respective institution has already sold stock it held in Mobifon, but declined specifying the name of the new investor.
“I have heard about the existence of a deal, but Posta Romana has sold the stake it owned with an acceptable profit,” stated Nicolae Mazgareanu, the single manager of Posta Romana.
Analysts estimate that the market value of Connex ranges between 800 million dollars and 1.5 billion dollars. The GSM operator already has almost 900,000 subscribers with coverage of over 90 percent of the Romanian territory.
Mark Boutet of TIW told Ziarul Financiar that the Canadian group does not plan to sell the entire stake it holds in Mobifon.
“Information related to the terms of the transaction will be supplied after the Securities Commission of the United States okays the move,” Boutet says.
TIW is a continuously developing telecommunications group that has over 2.9 million subscribers. TIW stock is listed on the Canadian and American bourse (Nasdaq).