mmO2 sells O2 Netherlands

By Alun Williams

Posted on 14 Apr 2003 at 11:59

mmO2 has announced that it has sold its Dutch subsidiary, O2 Netherlands.

The company has been bought for €25m (£16m) in cash by Greenfield Capital Partners, a corporate finance group with interests in the telecoms sector. The price is considerably less than the company paid (£266m) for its 3G licence alone.

The transaction - involving the sale of all shares - is expected to be completed by the end of May, subject to clearance by authorities in the Netherlands.

The most recent results for O2 Netherlands show that it had a turnover of £200m in the year ending 31 March 2002. In this period it recorded an operating loss of £119 million.

In its official statement, mmO2 declared that the sale proceeds would be used to help fund the operations of the core businesses of mmO2 plc.

'Today's agreement opens up an exciting new future for O2 Netherlands, its customers and employees,' said Stef van Doesburg, a partner of Greenfield Capital Partners. 'The business is complementary to our existing telecoms portfolio which includes Enertel NV, the number two dial-up telecoms operator in the Dutch market. This acquisition supports our overall strategy of investing in companies that offer a competitive range of fixed and mobile services.'

'The Greenfield offer enabled us to sell at a realistic valuation given market conditions in the Netherlands,' said Peter Erskine, CEO of mmO2. 'We remain focussed on our strategy of delivering organic growth and continuing to improve the operational performance - and, therefore, the value - of the Group's businesses in core markets.'

O2 Netherlands - formerly known as Telfort Mobiel - was created in November 2001 with the formation of mmO2 plc after its demerger from BT. Before that, Telfort Mobiel was founded in 1996 as a joint venture between BT and Nederlandse Spoorwegen N.V., a Dutch railway company.

At first it provided fixed line services only, but 1998 became a mobile network operator. In July 2000, the Telfort Group paid £266m to hold one of the five Dutch 3G (UMTS) licences.