Tele2 mulls Norway exit after auction washout

Sweden-based Tele2 AB confirmed on Wednesday that it is in the process of evaluating a number of strategic opportunities for its Norwegian operations and has hired ABG Sundal Collier Holding ASA to advise it on the different options.

Among the possible options are entering a strategic partnership, divesting Tele2 Norway to one or several parties, or continuing growing the business organically within the Tele2 group, the company said, emphasising that no decision has yet been taken.

Bloomberg reported that Barry Zeitoune, an analyst at Berenberg in London, values the Norwegian assets at 4 billion Swedish kronor (€451 million/$620 million).

"As previously communicated we are evaluating our different opportunities for our Norwegian businesses," said Mats Granryd, CEO and president of Tele2 AB. "Exploring various strategic options is an ongoing part of our responsibility towards our shareholders. However, we cannot speculate on the potential outcomes of any such discussions."

The future of Tele2 Norway has been up in the air since the company failed to win an LTE licence and additional 3G spectrum during an auction in December. Rivals TeliaSonera, Telenor and newcomer Telco Data all won blocks in the 800 MHz, 900 MHz and 1800 MHz frequency bands. At the time, analysts suggested the outcome could lead to cooperation between Telco Data, which is owned by Ukrainian-born billionaire Len Blavatnik's Access Industries, and Tele2.

Berenberg's Zeitoune said Tele2 should also consider selling its Dutch assets, which may fetch 8 billion Swedish kronor. "For us, Tele2 is the perfect breakup candidate," he said, Bloomberg reported.

Tele2 only this week appointed former Virgin Media marketing chief Jeff Dodds as the new CEO of its Netherlands-based unit.

Tele2 sold its Russian unit to state-controlled bank VTB a year ago. In December, Rostelecom approved the merger of its mobile assets with Tele2 Russia to form a joint venture called T2 RTK Holding.

In February, Granryd promised to "remove uncertainty" surrounding Tele2's business in 2014, after net income fell by a third in 2013.

For more:
- see this Tele2 statement
- see this Bloomberg article
- see this Reuters article

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