Telekom Austria announced today that it has completed the acquisition of a 70% stake in Cypriot SB, the sole owner of the Belarusian mobile operator Mobile Digital Communications (MDC) for an enterprise value of approximately EUR730 million (USD1.07 billion). In a statement, the Austrian group said it had now received the approval of relevant antitrust authorities. In October it agreed a deal to buy Belarus' second largest mobile operator from Mr. Ead Samawi and his partners, and entered into a call and put option agreement related to the remaining 30% stake held by Mr. Samawi and his partners exercisable in the fourth quarter 2010, for approximately EUR320.1 million. The option also includes a deferred consideration, payable in the fourth quarter 2010, which will be directly linked to the future financial performance of MDC.
MDC, which markets its mobile communication services under the brand names 'Velcom' for post-paid services and 'Privet' for pre-paid services, had more than 2.7 million customers and 42% of the domestic market at 30 June 2007; cellular penetration reached 66% at that date. MDC will be fully consolidated into the mobile communication segment of the Telekom Austria Group from 1 October 2007 and will positively impact revenues and EBITDA of Telekom Austria Group for the full year 2007, it said.
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