EU approves merger of Telenor and Telia
The EU Commission said yes on Wednesday to the merger of Telenor and Telia. "The decision was very welcome, and we have plans ready to introduce a strong, customer-oriented and very competitive telecommunications company to the Scandinavian market and internationally", says the future President and CEO Tormod Hermansen.
The merged Telenor/Telia will be the sixth largest telecommunications company in Europe with 51,000 employees and sales of around SEK 43 billion or NOK 41 billion for the first half of 1999. "This is a positive merger. Telenor's and Telia's combined expertise and experience give the new company a strong platform for international expansion. We have high ambitions in the areas of mobile communication, Internet and IP carrier activities. In a few years 50 per cent of the new company's income will come from operations outside of Norway and Sweden" says Tormod Hermansen.
In addition to its international ambitions, the company will also aim to reinforce its position as the leading telecommunication company in Scandinavia and improve its good customer relations in its home markets.
Tormod Hermansen believes that the measures requested by the EU commission such as the sale of overlapping activities in Norway, Sweden and Ireland, opening of the access network and sale of the cable TV activities in both countries are fully acceptable. "The benefits from merging Telenor and Telia more than compensate for the EU requirements", says Hermansen.
It is intended that Telenor/Telia shares will be listed next year. The Swedish state will initially own 60 per cent of the shares in the merged company, and the Norwegian state will own 40 per cent. The respective Governments will each gradually reduce their ownership stakes to 33.4 per cent so that other owners will control 33.2 per cent of the company.
A general meeting of Telenor/Telia has been scheduled for 18 October. The Board of Directors for the new company will be elected at this meeting. Jan-Åke Kark will be appointed as the Board Chairman and Tormod Hermansen will be appointed as the President and CEO as agreed.
For further information contact:
Acting Telenor press officer Steinar Ostermann,
tel. +47 22 77 85 90, mobile +47 907 52 891
Telia's press service, tel. +46 8 713 5830
Facts: Telenor/Telia's EU commitments
1. Sale of overlapping activities
Telia Norge's activities
Telia Nättjänster Norden's services in Norway
Telenor's activities in Sweden
– 33 per cent ownership interest in Telenordia
– Telenor's ownership stake in Internordia and the directory activities Lokaldelen and Företagsinfo have already been sold.
One of Telenor/Telia's two companies in Ireland, either Telia's 14 per cent stake in Eircom (formerly Telecom Eireann) or Telenor's 49.5 per cent stake in Esat Digifone. No decision has yet been made as to which of these interests will be sold.
2. Sale of cable TV activities
Telia Infomedia Television's Swedish activities
Telenor Avidi
3. Opening of access network
Competing operators must be allowed to lease the last part of the telephone line link to customers
Competing operators must be allowed to deploy technical equipment in connection with Telenor/Telia's installations
Pricing must be based on actual costs
