KPN mops up Telfort

Former O2 sub

KPN is boosting its Dutch mobile business with the acquisition of Telfort for around €980m on a debt and cash-free basis. This means that the current owners will get $80m and whatever cash is slurping around Telfort's sales ledger and bank accounts - the company has debts of €900m. KPN could pay up to €140m more for the business, if performance targets are met.

Telfort used to be 02 Netherlands and was sold off a couple of years ago to Greenfield and Enertel for € 25m. Last year, Dutch investor Marcel Boekhoorn acquired a controlling interest in Telfort through his company Ramphastos.

By acquiring Telfort KPN hopes to reach higher-growth customer segments and take its revenue share in its home Dutch market to more than 40 per cent.

Telfort will remain a separate company under KPN. It has 2.4m mobile subscribers and has a strong position in cost-conscious consumer segments. It is also the first operator in the Netherlands with national broadband network coverage - it uses EDGE technology. In 2004/20005 Telfort's net sales were €509m (2003/2004 €422m) and EBITDA of €97m (2003/2004 €67m).

KPN serves 7.4 million fixed-line subscribers and 1.7 million Internet users in the Netherlands as well as 17.7 million mobile customers in Germany, the Netherlands and Belgium.

The acquisition is subject to regulatory approval. ®

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