PTCL Acquire Telenor for 108 Billion Rupees
Pakistan Telecommunication Company Limited (PSX: PTCL), a significant player in the technology and investment domain under the umbrella of e&, has recently sealed a pivotal Share Purchase Agreement (SPA) with Telenor Pakistan (Private) Limited (TPL), aiming to secure the entirety of TPL’s shares at an Enterprise Value of Rs108 billion.
PTCL Officially Purchased Telenor Pakistan
PTCL – Pakistan Telecommunication Company Limited had signed an agreement with Telenor to acquire the 100 percent stake in the company for Rs.108 Billion PKR.
Strategic Move By PTCL
The recent agreement disclosed by PTCL on the Pakistan Stock Exchange emphasizes that the acquisition will proceed on a cash-free, debt-free basis, with the funding sourced via external debt that PTCL will raise.
Telenor Pakistan, a notable mobile operator serving a colossal 45 million subscribers, reported revenue of Rs112 billion and an impressive EBITDA margin of 43% based on the last twelve months (LTM) financial reporting until September 2023.
Telecom Sector Reinvention Through Consolidation
This transaction marks a significant milestone, presenting an avenue for in-market consolidation within the telecom sector. Such a coalition is poised to enhance the industry’s long-term prospects, ushering in a new era of transformation and growth.
Understanding the Strategic Vision Behind Telenor’s Move
Telenor Group’s decision to divest its Pakistan operations is in line with its strategy to fortify scale and foster market-leading entities in Asia, aligning with the objectives outlined during the 2022 Capital Markets Day. This move concludes the comprehensive strategic review initiated in July 2022, focusing on telecom operations in Pakistan.
The remainder of Telenor Asia’s portfolio encompasses esteemed operators like Grameenphone in Bangladesh, CelcomDigi in Malaysia, and True Corporation in Thailand, collectively catering to nearly 160 million customers.
Insights into the Transaction Value and Telenor’s Perspective
The transaction estimates the value of Telenor Pakistan at NOK 5.3 billion on a cash-and-debt-free basis. It includes addressing intercompany loans amounting to NOK 3.5 billion and reducing interest-bearing liabilities, incorporating leases amounting to NOK 1.8 billion.
Sigve Brekke, Chief Executive Officer (CEO) of Telenor Group, expressed, “Our decision to divest our Pakistan operations is a testament to our successful 18-year journey in the country, commencing from a greenfield rollout. Telenor Pakistan stands as an adept and future-ready telco operator, boasting a robust distribution network and an adept team, serving 45 million customers.”
Petter-Bรธrre Furberg, Head of Telenor Asia, commented, “After meticulous consideration, the sale aligns with our strategic goals of fostering a robust local champion to enhance market dynamics. We affirm our commitment to the Telenor Pakistan team and partners as they continue their exemplary service to customers during this transition. Looking ahead, Telenor Asia remains committed to actively overseeing our Asian portfolio’s three market-leading businesses.”
Continuity and Future Trajectory
The transition will continue Telenor Pakistan’s operations; the company will continue business as usual, focusing on serving its 45 million-strong customer base. The agreement remains contingent upon regulatory approvals and customary terms and conditions, expected to conclude during 2024, as indicated in the official statement.
The PTCL acquisition of Telenor Pakistan represents a pivotal moment in Pakistan’s telecom landscape, promising transformational opportunities while ushering in a new phase of growth and innovation.
Follow Top and Trending on Google News and receive the latest alerts and the main news about apps, technology, beauty, entertainment, and all the top 10 related posts.