PPF Group will no longer be the sole owner of the Central European network operator Cetin Group. It has agreed with the Singapore state investment fund GIC to sell it a 30 percent stake in this group and will now hold only the remaining majority. The parties to the transaction have agreed not to comment on the financial details of the transaction. From the results of the company and the field where it does business, however, it can be deduced that tens of billions of crowns went.
The sale of part of Cetin has been talked about for a long time. In February of this year, for example, PPF admitted that admission to the stock exchange is also at stake. A month later, the Bloomberg agency came with the news that such a transaction could value Cetin at about 175 billion crowns. The price of a 30 percent share in the then valuation would be around 50 billion crowns.
According to a source in the daily E15 in the field of telecommunications, the advantage of direct sales over the subscription of shares is more. “It’s a more direct and easier business. At the same time, the company will not be forced to report new numbers quarterly and thus be much more transparent than its competitors. If a buyer with an interesting offer is found, it makes sense, “says a source who did not want to be named.
Capitalinked.com founder Radim Dohnal sees the transaction as evidence that PPF sees the sector close to its peak or fears regulatory or tax intervention. “For such cases, it is advantageous to have a government fund from a prominent country by your side as one of 11 countries with an S&P rating at the AAA level. I don’t know if the motive for PPF is also the need to bring additional resources to Home Credit, but it is possible, “he told ČTK.
PPF did not say what the company will use the money from the transaction for. The CEO of CETIN Group, Juraj Šedivý, only stated that new opportunities and opportunities for further growth can be expected with the new partnership. The former head of the Czech Telecommunications Office, Jaromír Novák, believes that with this transaction PPF could acquire a partner for more intensive construction of optical networks in the region, and at the same time freed its hands for further investments.
CETIN was established in 2015 by separating the infrastructure from the telecommunications operator O2 Czech Republic. It has been operating as a group since 2020, when the infrastructure was separated from the operators operating under the Telenor brand in Bulgaria, Hungary and Serbia. They have been a part of PPF’s telecommunications portfolio since 2018. Last year, its consolidated operating profit (EBITDA) increased by two percent to 1.4 billion euros, in terms of approximately 36 billion crowns.
GIC is a global investment company founded in 1981. It has investments in more than 40 countries. The transaction will still have to be approved by the relevant regulatory authorities.