Aggressive takeover of Forthnet?

Telecommunications market professionals say listed firm Forthnet is the intended target of an aggressive takeover bid as certain investment funds are said to be behind the acquisition of a 27 percent stake by a Cypriot law firm. They are believed to be eyeing full control of the company which also owns the market-leading Nova pay TV platform.

If those funds achieve their objective, they are expected to then attempt to sell Forthnet to a rival telecom provider, with Wind Hellas being first in line after getting the call option to acquire the 27 percent sold to the Cypriot firm, as Forthnet announced on Thursday.

In a statement to the Greek bourse, Forthnet confirmed the agreement between Wind, Greece’s third-largest cell phone network, and Cyprus’s Zesmero Limited, which now owns the 27 percent stake in the Greek telecoms company. Zesmero is 100 percent-owned by Cypriot group Kali Zoe, which in turn is owned by Fotos Pittatzis.

This points to someone having promised Wind the whole of Forthnet despite not having it at their disposal yet, which explains the 12-month delay in the transfer of the company’s shares, as Wind can only activate the call option next July, within two weeks of July 18, 2014.

All these moves appear to have taken place without the consent of Forthnet’s main shareholder or the company’s management. Emirates International Telecommunications, holder of 40 percent of the company, will therefore have to decide how it will react to this expected aggressive takeover bid.

The Arab owners could either choose to sell their stake or invest fresh funds during the forthcoming share capital increase in order to retain it. It has already called for an extraordinary board meeting, which is indicative of the fact that it is about to abandon its passive attitude.

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