THE HAGUE, The Netherlands-KPN Telecom of the Netherlands and Telia of Sweden announced they will sell their stakes in Eircom, the Irish telecom operator that owns Eircell, Ireland’s largest wireless operator. The decision follows the European Commission’s requirement that the combined Telia/Telenor group divest one of its interests in the competing Irish telecom operators.
Telia owns, indirectly through Comsource, a 14-percent stake in Eircom. KPN holds, also indirectly through Comsource, a 21-percent investment in Eircom. KPN’s investment is valued at about $1.93 billion.
Norway’s Telenor owns 49.5 percent of Esat Digifone, the second-largest cellular operator in Ireland.
In 1996, the Irish government selected the KPN/Telia consortium, under the Comsource name, to support the former Telecom Eireann in offering services.
“The Telia/Telenor merger and subsequent European Commission decision have accelerated KPN’s decision to withdraw from Eircom, so as to invest the proceeds in activities that meet all of its investment criteria,” KPN said in a statement.
Press reports said the sell-off makes KPN a takeover candidate in the turbulent European telecom market.
KPN and Telia are subject to a lock-up agreement entered into at the time of the Eircom initial public offering and expiring on Jan. 7.
