ECONOMY

Telekom Austria bids for a majority stake in Mobiltel

VIENNA (Reuters) – Telekom Austria AG has made a non-binding offer for a stake in Bulgaria’s largest mobile phone operator, Mobiltel, the dominant Austrian fixed-line and wireless provider said yesterday. «We have made an offer. The seller must now decide whether we can start with due diligence,» Telekom spokesman Martin Bredl told Reuters. Mobiltel is owned by Austrian investors who want to sell between 25 percent and 49 percent of the group. Bredl did not specify the offer price or exactly what size the stake would be. Industry sources in Sofia earlier this week said several strategic investors had placed initial bids and that the size of the stake had yet to be determined. The sources said other interested parties include British-based cell phone giant Vodafone Group Plc, TeliaSonera and Norway’s Telenor. But only Telekom Austria has so far confirmed it is interested in Mobiltel, as part of its strategy of expanding its profitable wireless division in the faster growing markets of Southeastern Europe. It already has ventures in Croatia and Slovenia. There were no details of the non-binding offer. Boris Nemsic, CEO of Telekom Austria’s wireless arm Mobilkom, has said he would want operating control of any acquisition. The company has also said it was prepared to spend up to the equivalent of one year’s free cash flow, or about 500 million euros, on an acquisition. Launched in 1995, Mobiltel is up against Globul, the local arm of Greece’s OTE Telecom since September 2001. At end-2002, it had 75 percent of the market.