LONDON-British Telecommunications plc and Telenor AS announced they have reached an agreement regarding Ireland’s Esat Telecom and its wireless arm Esat Digifone. BT is acquiring a 49.5-percent stake in Esat Telecom for $2.5 billion, trumping an earlier $1.9 billion hostile takeover bid by Telenor.
Under the deal, Telenor could exchange its 49.5-percent shareholding in Esat Digifone for a 33-percent shareholding in Esat. If Telenor chooses this option, it could purchase further shares in Esat to increase its stake to 49.99 percent for $624 million. BT would still have overall control.
If Telenor does not opt to exchange its Digifone holding for an Esat stake, it could sell to Esat its 49.5-percent holding in Esat Digifone for $1.24 billion.
“We are very satisfied with this outcome,” said Telenor executive Tormod Hermansen. “We have achieved our objective of being able to extend our strong position in Ireland …”
Previously, Telenor and Esat each owned 49.5 percent of Digifone, Ireland’s second-largest wireless operator. Earlier this week, BT agreed to acquire the other 1 percent from Dermot Desmond, an Irish businessman, giving it 50.5 percent.
For analysis of BT’s buy of Esat, turn to related story in this issue on page 21.
