France Télécom rumoured to be selling Polish PTO

17 Jun 2003

According to unofficial sources close to the company, there are indications that France Télécom is looking to sell its stake in Polish incumbent Telekomunikacja Polska (TP SA). French bank BNP Paribas and an investment unit of the German Dresdner Bank are said to be involved in the withdrawal of the French giant’s investment activities from the Polish telco.

A former state-owned monopoly, TP SA offers a full range of telecommunications services in the fixed line, internet access and data transmission markets, and offers wireless services through its majority-owned mobile arm Centertel. France Télécom currently has a 33% stake in the company, which dominates the market with a share of 90.7%; its closest rival controls just 2.8%. At the end of 2002 the telco had 10.8 million fixed lines in service, of which 10.1 million were PSTN and 687,000 ISDN lines. For the near future TP SA is focussing on the development of broadband services having introduced ASDL, under the brand name Neostrada in 2001; a year on it reported a customer base of 14,000.

France Télécom originally purchased a 25% stake in TP SA in 2000 following the PTO’s privatisation. It is also involved in the Polish wireless market through its 56.4% holding in mobile operator PTK Centertel. If the Paris-based company does sell, one option could be a management buyout (MBO), with the Finance Director of TP SA at the helm. The transaction would be handled by BNP Paribas and Dresdner Bank. Such an option is believed to be under consideration as a result of the poor state of the Polish telecoms sector; it may prove challenging to find an investor prepared to offer an attractive price for TP SA.

Poland
CIT datafile of Eastern Europe