Hutchison Whampoa boosts European holdings with €1.3B Orange Austria buy

Hong Kong-based Hutchison Whampoa is expanding its European footprint with the purchase of Orange Austria for €1.3 billion.

The deal, which is expected to be completed by mid-2012, will see Hutchison 3G Austria become the third largest operator in the country after Telekom Austria's A1 and Deutsche Telekom's T-Mobile Austria.

The merging of 3G Austria with Orange Austria will create an operator with nearly three million subscribers and around 20 per cent of the total market, noted Reuters, adding that Hutchison was expecting to generate expense and Capex synergies of at least €500 million once the integration take effect.

The acquisition will also see some assets of Orange Austria sold to Telekom Austria Group for €390 million once the sale is formally closed. These are said to include existing spectrum, base station sites, certain intellectual property rights and the MVNO Yesss Telekommunikation.

Orange Austria is jointly owned by France Telecom and UK-based Mid-Europa Partners, with the French company expecting to receive around €70 million for its 35 per cent holding in the Austrian business, which had around €1 billion of debt.

Analysts working for the financial service firm Raymond James told Reuters that France Telecom could use the proceeds to strengthen its position in the Belgium operator Mobistar. "This would also leave more than enough to pay for half of the acquisition of minority interests in Mobistar while the other half would be paid by potential tax synergies."

For more:
- see this Reuters article
- see this Bloomberg article

Related Articles:
Report: Hutchison nears deal to buy Orange Austria
Rumour Mill: Apax Partners eyes Sunrise link after Orange Switzerland buy
Orange Switzerland sale triggers high interest; but CVC reportedly excluded
France Telecom pushes for sale of Swiss, Austria and Portuguese units

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