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. Last Updated: 07/27/2016

France Telecom to Pay $4.3Bln for TPSA Stake




WARSAW, Poland -- France Telecom on Tuesday sealed the purchase of a strategic stake in Poland's state-controlled telephone operator Telekomunikacja Polska SA, taking control of a juicy chunk of Central Europe's biggest telephone market.


The French giant and politically well-connected Polish private conglomerate Kulczyk Holding agreed to pay Poland 18.6 billion zlotys ($4.3 billion) for 35 percent of TPSA in post-communist Eastern Europe's largest state sell-off.


Under the contract, the group will have the right to raise its stake to 51 percent by buying 6 percent in next year's public offering of TPSA shares and buying another 10 percent state stake in the dominant local operator in 2001.


France Telecom lost its first bid for control over TPSA last year when Poland rejected its bid as too low. Now it is paying 38 zlotys per TPSA share against last year's offer of 23 zlotys.


The treasury will be pleased with the price it achieved, which exceeded its original forecast of $4 billion.


Poland's biggest privatization has been watched by the local currency market, with players speculating how much of the $4.3 billion will be exchanged into zloty on the local forex market.


The deal is subject to regulatory approval and should be closed by mid-September.


TPSA connects 95 percent of Poland's fixed-line customers, and its cellphone group Centertel, in which the French have 34 percent, has 1 million subscribers, or some 20 percent of the mobile market.