CT in talks to acquire Eurotel

Cesky Telecom has reopened negotiations to acquire the remaining 49 percent share of mobile operator Eurotel that it doesn't already own, company spokesman Vladan Crha confirmed April 25. Talks between Cesky Telecom (CT) and the Atlantic West consortium, the owners of the 49 percent stake, are preliminary, Crha added. Information Technology Minister Vladimir Mlynar and CT board Chairman Ondrej Felix led informal talks with Atlantic West -- which consists of AT&T and Verizon Communications -- during a private visit to New York in mid-March, Crha said. The renewed set of negotiations coincides with the government's latest effort to sell its stake in CT. Following a failed privatization effort last year, the Finance Ministry has asked the Cabinet to draft a new plan to sell the company by June 2004 in order to privatize it by 2005. The state holds 51 percent of CT. Analysts say both sides would now benefit from closing a deal for Eurotel because the crown is strong versus the U.S. dollar, making the sale price more attractive. The estimated selling price is around $1.28 billion (37 billion Kc). In addition, AT&T and Verizon both have considerable debt, which totaled $22.5 and $54 billion, respectively, at the end of 2002. CT's long-term strategy is to raise its share in Eurotel, one of Europe's most-profitable mobile operators. The company's net profit rose 9 percent to 1.64 billion Kc in the first quarter of this year, and its customer count increased by 16 percent to 3.95 million.