A Share Purchase Agreement (SPA) has signed by Pakistan Telecommunication Company Limited (PTCL), a member of the technology and investment group e&, and the shareholders of Telenor Pakistan (Private) Limited (TPL) to purchase all of TPL’s shares, with an enterprise value of Rs. 108 billion.
PTCL Acquired 100% of Telenor Pakistan in Rs. 108 Billion
Moreover, the sale will complete without any cash or debt, and PTCL will finance the acquisition using external debt that it will raise, according to the company’s filing on PSX on Thursday.
However, based on financial reporting for the previous 12 months, Telenor Pakistan is a prominent mobile operator with 45 million members, reported revenue of Rs. 112 billion, and an EBITDA margin of 43%.
Additionally, the telecom industry’s long-term prospects will be enhanced by the the acquisition, which will allow for in-market consolidation.
One of PTCL’s principal assets is Ufone, a mobile provider with more than 20 million users in Pakistan.
Telenor Press Release
In a press release, Telenor Group stated that the transaction is a component of its plan to develop market leadership and scale in Asia, which will be showcased at the 2022 Capital Markets Day.
However, the strategic review of the telecom operations in Pakistan, which was declared in July 2022, has come to an end.
With nearly 160 million consumers, the entire Telenor Asia portfolio includes market leaders Grameenphone in Bangladesh, CelcomDigi in Malaysia, and True Corporation in Thailand.
Moreover, in cash and debt-free terms, the transaction values Telenor Pakistan at NOK 5.3 billion.
However, this includes reducing interest-bearing obligations of NOK 1.8 billion, including leases, and repaying intercompany loans totaling NOK 3.5 billion.
Chief Executive Officer (CEO) Telenor Group Sigve Brekke Statement
Chief Executive Officer (CEO) Telenor Group Sigve Brekke said, “We decided to sell our Pakistan operations after 18 successful years of operations in the country, which started as a greenfield rollout.
We are proud of the company Telenor Pakistan is today. It is an efficient and future-ready telco operator, with a strong distribution network and talented team serving 45 million customers.”
“By selling to the country’s largest integrated ICT company, we believe this consolidation move will help strengthen Pakistan’s telecoms sector, creating opportunities in new areas of growth to the benefit of consumers in Pakistan,” he added
Petter-Børre Furberg, Head of Telenor Asia Statement
Petter-Børre Furberg, Head of Telenor Asia, said, “We carefully considered all alternatives during the strategic review process and believe that, after a sale, the market will be better served by a strong local champion.
Our strategy in Asia is to build number one positions in the markets we operate, with scale as a pre-requisite for value creation and profitable growth.
We thank and acknowledge the commitment of the Telenor Pakistan team and partners, who will continue to serve customers well in the transition.
Looking ahead, Telenor Asia will remain an active owner for the three market-leading businesses that make up our Asian portfolio.”
Transaction To Complete
Telenor Pakistan will carry on with its operations as usual, concentrating on providing services to its 45 million clients.
The agreement is contingent upon normal terms and conditions as well as regulatory clearances.
The announcement further stated that the transaction is anticipated to be completed in 2024.
To read our blog on “To acquire Telenor Pakistan, PTCL has made a binding offer,” click here.
