Ericssson EDGE for the Netherlands (Telfort was O2)
In the coming years the group will focus on building out its GSM network with the next-generation EDGE technology, working closely still with equipment supplier Ericsson on any new technological or commercial developments, the CEO said.
>> O2 Netherlands To Focus On Existing Technologies; Renamed Telfort
AFX.COM
April 14, 2003
Amsterdam
Greenfield Capital Partners, the private equity group acquiring O2 Netherlands BV from mm02 PLC, said it will focus on the Dutch telecoms market and existing "proven" technologies, such as GSM, in developing the newly independent company.
O2 will change its name back to Telfort, the company's name when it was first launched in 1997 in the Netherlands in a joint venture between BT Group PLC and the Dutch Railways, O2 Netherlands CEO Ton aan de Stegge told a news conference.
Greenfield, which also owns the Dutch fixed-line operator Enertel, plans to focus Telfort on the Dutch market, with no plans to expand to other countries, according to Greenfield director Pieter Bolhuis. Greenfield has set aside an unspecified amount for further investment at Telfort, Bolhuis said.
Much of the future financing is expected to come from cash flow, as the company recently turned EBITDA positive. O2 Netherlands' debt, estimated at almost 200 mln eur, will stay with mm02, the CEO said.
Telfort has shelved its plans to roll out a UMTS network in the Netherlands, given that the business case for UMTS services is still unclear.
"UMTS still has to be proven and we have our questions," Aan de Stegge said.
"We are only going to invest in things which make money."
Under the terms of its UMTS licence, the company has no service obligation in the Netherlands until 2007.
In the coming years the group will focus on building out its GSM network with the next-generation EDGE technology, working closely still with equipment supplier Ericsson on any new technological or commercial developments, the CEO said.
Telfort will continue virtual network agreements with Debitel and Tele2, Aan de Stegge said.
The agreements have added about 200,000 clients to its direct subscriber base of about 1.25 mln.
Telfort expects to expand further in the wholesale market, which currently accounts for about 10 pct of sales, though working with Enertel, the wholesale fixed-line operator owned by Greenfield.
Telfort is also in talks with several "well-known" brands in the Netherlands interested in providing mobile services, the CEO said.
Companies such as Shell, Vendex KBB retail chain Hema and Scarlet Telecom have recently expressed interest in the mobile market, although the CEO declined to say with which parties Telfort is talking.
Greenfield has ambitions to further expand in the "undervalued" telecoms market, with "tens of milliosn of euros" set aside to form a "complete telecoms package" in the Netherlands, Bolhuis said.
The company is taking a 60 pct direct stake in Telfort, with the remaining 40 pct held by three financial parties and Enertel. Bolhuis declined to name the other investors, saying all parties are investing for the "long term" in Greenfield's "buy and build" strategy.
A public offering of shares in Telfort is currently not planned, he added. Greenfield started talks four to five weeks ago with mm02 on buying the Dutch unit, Bolhuis said.
The price had already dropped significantly from 200-500 mln eur when mm02 first started talks with a number of parties earlier in the year.
According to Aan de Stegge, the company opted for Greenfield because a merger with an existing operator would have resulted in the overlap of networks as well as negative consequences for personnel.
While the CEO hopes to avoid forced redundancies as a result of the Greenfield takeover, he expects total staff to drop to around 550 within a year from the current 750.
Further reorganisation details will be announced in in the coming weeks.
In the six months to Sept 30, O2 Netherlands had sales of 203 mln eur and an EBITDA loss of 14 mln eur.
The company competes for the number three position in the Dutch market with Orange and T-Online, with Vodafone and KPN market leaders.
Given that the company already formed international roaming agreements under the name Telfort, there is no cooperation planned with an international mobile operator, the CEO said. <<
- Eric - |
