TDC raises bid for Song to SEK4.8 billion

28 Sep 2004

Denmark’s largest telecoms company TDC has raised its bid for Swedish corporate telecoms service provider Song Networks to SEK4.8 billion in cash, topping last week’s bid by Tele2 by SEK7.5 per share. TDC raised its offer by 18%, from SEK70 to SEK82.5 per share, trumping Tele2’s tender of SEK75 per share. Both TDC and Tele2 are keen to get their hands on Song because of its enviable position in the Nordic corporate broadband internet access market. The Danish operator is keen to develop a competitive edge in the business market by meeting growing demand for cross-border communications solutions. It anticipates the acquisition of Song would create cost savings of SEK250 million per annum, once Song Networks and TDC Solutions have been fully combined. Tele2 meanwhile has gone on the record as saying that the purchase would enable to expand its product portfolio in both the business and residential market and enable it generate annual synergies of SEK300 million by 2006.

Song Networks has a presence not only in Sweden, but also in Finland, Denmark and Norway. It has established a comfortable niche for itself within the data communications market, thanks to its particular emphasis on IP VPN and internet access provision. At mid-2004 the company claimed 14,300 customers, of which 3,000 were directly connected to its own 19,000km fibre-optic network.

Denmark, Sweden