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Telekom Austria, Magyar Telekom possible suitors for Ukrtelecom

Telekom Austria has this week indicated that it would consider bidding for a controlling stake in Ukrainian incumbent fixed line operator Ukrtelecom.

The new government of Ukraine announced this month that it was relaunching plans this year to sell a stake in Ukrtelecom, and raising the amount on offer to 67%. Another European telco, Hungarian incumbent Magyar Telekom, controlled by Germany’s Deutsche Telekom, says it is considering fresh acquisition targets in Eastern Europe, including Ukraine, following its recent failure to win a stake in Telekom Slovenije. Ukrtelecom re-entered its domestic mobile market in November 2007, launching Ukraine’s first 3G W-CDMA service, and it remains the country’s only UMTS licensee.

Previously, Russian telco Comstar UTS, part of the Sistema Group, has declared its interest in acquiring a stake in the former monopoly, whilst the only domestic strategic bid is likely to come from System Capital Management (SCM) Group, parent of fixed line network operators Optima/Farlep and co-owner of cellco Astelit. Ukraine’s mobile subscribers rose by 800,000 in December, ending 2007 at 55.6 million, giving the state a cellular penetration of 119%, up from just under 100% a year ago (based on population figure for 2006). (TeleGeography)