Telekom Austria announces €1B capital increase

Telekom Austria has finally revealed the timing for its long-awaited capital increase of up to €1 billion ($1.2 billion), with América Móvil and state-owned ÖIAG together committing to 88.1 per cent of the cash call in order to remain core shareholders.

 SEO keywords here

Hannes Ametsreiter, Telekom Austria CEO

The Austrian operator, which is almost 60 per cent owned by Mexico-based América Móvil, said the subscription period would start on Nov. 10 and end on Nov. 24, with trading on the Vienna Stock Exchange expected to start on Nov. 27. Around 221.5 million shares will be offered to existing shareholders and new investors at a price of €4.57 per share.

América Móvil and ÖIAG are keen to retain their existing shares; the state-owned company has previously indicated that it would seek to retain its 28.42 per cent stake in the operator following the capital increase.

Telekom Austria confirmed that it plans to use the net proceeds of the capital increase to "re-establish its target capital structure" and maintain a stable credit rating of at least BBB by Standard & Poor's.

"The proceeds of the capital increase…will be used to strengthen our balance sheet, boost infrastructure investments especially in Austria. Furthermore we will continue our expansion with focus on convergence as well as in-market consolidation and even consider expansion via new operations," said Hannes Ametsreiter, CEO of Telekom Austria Group.

In Austria, the company's "strategic investment priorities" include an accelerated rollout of its fibre infrastructure during 2015-2018.

As well as providing mobile and fixed services in Austria under the A1 brand, the group also operates a number of fixed and mobile operators across Central and Eastern Europe. In October, Telekom Austria reached agreement with Telekom Slovenije to merge their respective mobile operators Vip Operator and One in order to create a new entity on the Macedonian market.

Ametsreiter also noted that recent strong third-quarter results "already showed a trend reversal for our group". Group revenue increased by 1.2 per cent year-on-year to €1.04 billion, reversing a downward trend in the first two quarters of the year. Comparable group EBITDA increased by 15.8 per cent to €414.6 million.

For more:
- see this Telekom Austria release

Related Articles:
Telekom Austria reports strong Q3 results, agrees Macedonia merger
América Móvil increases its stake in Telekom Austria to almost 60%
Telekom Austria approves €1B rights issue
Telekom Austria cuts 2014 outlook, posts H1 loss on Bulgaria writedown
Report: Austrian state expects to maintain Telekom Austria stake

Suggested Articles

Sprint said it will offer discounted service to customers age 55 and above.

Unlimited data plans placed a strain on carrier networks last year, but according to OpenSignal the carriers met the challenge.

Verizon plans to bring 5G to four U.S. cities this year and hopes to have standards-based equipment in place for some of those deployments.