Telenor Group has agreed to acquire a controlling stake in Swedish broadband provider Bahnhof in a transaction valuing the company at SEK 6.1 billion on an enterprise value basis. The acquisition will make Telenor Sweden’s second-largest fixed broadband provider. Completion of the acquisition, which is subject to regulatory approvals, will trigger an obligation for Telenor to make a mandatory cash offer to all shareholders of Bahnhof.
“Sweden is the largest Nordic market by population and a key strategic priority for us. This transaction gives us the breadth and scale to compete more effectively and create long-term value for customers and shareholders,” says Benedicte Schilbred Fasmer, President and CEO of Telenor Group.
A stronger platform for growth
Founded in 1994, Bahnhof has built a strong and profitable fixed broadband business in Sweden, serving more than 500,000 consumer customers and approximately 15,000 enterprise customers. The company’s assets include proprietary network infrastructure, access to open networks and five colocation data centres. Combined with Telenor’s existing fixed and mobile operations in Sweden, Bahnhof adds complementary strengths in fixed broadband, enterprise services and secure infrastructure.
“Over the years, we have built Bahnhof into a customer-focused company with a trusted brand and a clear position in the Swedish market. By joining Telenor, we gain the scale to compete more effectively across both existing and new market segments”, says Jon Karlung, CEO of Bahnhof, who together with co-founder Andreas Norman will join Telenor as part of the transaction.
Strengthening Telenor’s Nordic position
Telenor is the only telecom operator with significant operations in all four Nordic markets. Sweden is the largest of these markets and, to date, the market where Telenor has had the greatest opportunity to grow. This acquisition provides the platform to accelerate that growth.
“With Bahnhof, we are adding a high-quality business with a strong brand, a proven track record and operational excellence. The transaction represents an important step in delivering on our long-term strategic ambitions and strengthening our Nordic presence,” says Schilbred Fasmer.
The acquisition will increase Telenor’s consumer subscriber market share from approx. 15% to approx. 27%. Following completion, Bahnhof will continue to operate under its own brand, maintaining its established focus on privacy, security and technical expertise. Telenor intends to build on Bahnhof’s market position while combining the capabilities of both organisations.
“This is an important step for Telenor in Sweden. Bahnhof brings a strong team, a loyal customer base and complementary capabilities. Together, we will be better positioned to offer competitive and relevant services to customers across Sweden,” says Jonas Edén, CEO of Telenor Sweden.
Financials and transaction structure
Bahnhof’s founders, Jon Karlung and Andreas Norman, directly and indirectly hold 50.8% of the shares and 86% of the votes, and Telenor has agreed to acquire their shares for SEK 60 per share. Telenor has also agreed to acquire the 6.7% shareholding (corresponding to 1.9% of the votes) held by Öresund Investment, the second-largest shareholder, for SEK 62 per share.
Following completion of the acquisition of the shares held by Bahnhof’s founders and Öresund Investment, Telenor will become the controlling shareholder in Bahnhof and intends, within four weeks after completion, to launch a mandatory cash offer to the remaining shareholders of Bahnhof at SEK 62 per share.
On a weighted share price basis, the transaction values Bahnhof at SEK 6.1 billion on an enterprise value basis (100%).
“The board of directors of Bahnhof is positive to the transaction and has permitted Telenor to conduct confirmatory due diligence, which has been a condition for the acquisitions and a potential subsequent mandatory cash offer to all shareholders,” says Jens Nylander, Chair of the board of directors of Bahnhof.
