HOT shareholders approve MIRS acquisition

21 Sep 2011

Shareholders in Israeli cableco HOT Telecommunications Systems have finally approved the acquisition of local iDEN provider MIRS Communications, Globes Online reports. With institutional investors having initially opposed proposals for the deal due to the approximately ILS1 billion (USD270 million) price tag affixed to the cellco, it is understood approval came only after the agreement was restructured. As previously reported by CommsUpdate, in July 2011 it was announced that HOT would pay MIRS shareholders ILS1.3 billion, minus the ILS257 million that MIRS owed its creditors, but under the revised terms of the acquisition it is understood that HOT will now pay ILS500 million cash and ILS450 million in future milestone payments for the cellco.

MIRS is already owned by HOT’s controlling shareholder, French businessman Patrick Drahi, who acquired a 100% stake in the iDEN operator via his Altice Group in December 2009 for USD170 million, and the merger with HOT will allow the cableco to provide a full range of telecoms services, including fixed line voice, high speed internet and television. Further, the deal is seen as a means of competing more effectively with fixed line incumbent Bezeq and other local telecom providers, with the added bonus for HOT that unlike its major rival it faces few regulatory constraints on pricing.