=DJ NEWS SNAP: Kuwait's MTC Buys Celtel For $3.4 Billion

الموضوع في 'السوق الأمريكي للأوراق الماليه' بواسطة bu-abdullaziz, بتاريخ ‏29 مارس 2005.

  1. bu-abdullaziz

    bu-abdullaziz عضو مميز

    ‏11 ديسمبر 2003
    عدد الإعجابات:
    Dow Jones News Services
    (Copyright © 2005 Dow Jones & Company, Inc.)

    By Nic Fildes


    LONDON (Dow Jones)--Kuwaiti wireless operator Mobile Telecommunications Company KSC (TELE.KW) Tuesday said it will buy pan-African telecoms company Celtel International BV (CELTEL.YY) for $3.4 billion in cash, gaining access to one of the world's fastest-growing regions.

    Amsterdam-based Celtel is one of Africa's largest telecoms companies, providing mobile services to 5 million people across 13 countries. The combination of the two will create an emerging market-focused groupwith more than 8 million subscribers across Africa and the Middle East.

    MTC's decision to buy Celtel is "sensible" as its core Middle Eastern markets mature, said Thecla Mbongue, analyst at London-based research firm Informa Telecoms & Media. Exposure to the countries Celtel operates in, as well as other markets like Angola where privately-held Celtel is expected to expand, will provide good growth opportunities, she said.

    Africa is the one of the world's fastest growing mobile-phone markets, but is the least developed due to the relatively low penetration of fixed-line telecoms services. Informa said that in 2004, mobile subscriptions across Africa rose 47% to 76.5 million. With a population of 850 million and most growth coming from South Africa, Morocco, Nigeria and Egypt, there is plenty of potential in the region.

    Celtel had planned to list its shares on the London Stock Exchange in the first half of 2005. By declaring its intention to float, it seems to have flushed out the bid.

    Informa's Mbongue said that the cash bid will please Celtel shareholders, offering them greater value and less risk than a stock market listing.

    MTC, which has a market capitalization of around $7 billion, has operations in Kuwait, Jordan, Lebanon, Iraq and Bahrain and also has a strategic partnership with Vodafone Group PLC (VOD). It has 3.4 million customers in the Middle East and previously said itaims to have 15 million users by 2011.

    Net profit at MTC increased 18% to $408 million in 2004, while revenues gained around 23% to $1.1 billion.MTC is Kuwait's second-largest listed company.

    Its strategy includes expansion into emerging markets like those in sub-Saharan Africa where Celtel operates.

    Under the terms of the deal, MTC will buy an 85% stake in Celtel from its current shareholders, which include management. The remaining 15% will be purchased within two years.

    Following the acquisition by MTC, Celtel will operate as a separate entity within the larger company and will continue to trade under the Celtel brand.

    African operators like Celtel have grown rapidly in recent times, benefiting from cheaper network infrastructure equipment.

    A new low-cost handset designed by Motorola Inc. (MOT) was launched at the Cannes 3GSM mobile industry conference in 2005, aiming to provide consumers in emerging markets with access to wireless telecoms. The handset, priced below $30, will drive further uptake, benefiting operators like Celtel.

    Pent-up demand for basic telecoms means African operators have achieved rapid subscriber growth by offering cheap tariffs to consumers that have never used telecoms services before. This is done by offering prepay services, which suits the predominantly cash-based African economies.

    Celtel has been profitable since 2003. It recorded average revenue per user, or ARPU, of $22.50 during the six months to June 30, 2004.

    In a recent interview with Dow Jones Newswires, Celtel cofounder and Chief Strategy Officer Terry Rhodes said: "We're serving the poor profitably - mobile carriers ignore this customer base at their peril."

    N.M. Rothschild & Sons Ltd. (NMR.YY) is the lead advisor to Celtel on the deal.

    Company Web site: http://www.celtel.com


    -By Nic Fildes, Dow Jones Newswires; 44-20-78429264; nicolas.fildes@dowjones.com

    (END) Dow Jones Newswires

    03-29-05 0530ET