Telia acquires TDC’s Norwegian business - Strengthens its Converged Offering

Telia Company is acquiring GET and TDC Norway at an enterprise value of NOK 21 billion on a cash and debt free basis.

Telia Company will combine its award-winning mobile network with GET’s supreme TV and fixed services to create a strong challenger on the Norwegian market with converged customer offerings.

The Danish operator TDC’s Norwegian business encompasses GET, a leading provider of fixed and TV services, with a total of 518,000 households and businesses connected to its fiber-based network, and more than 1 million private and business customers who use the TV and broadband services on a daily basis.

TDC’s B2B business in Norway is also part of the transaction which paired with Telia’s enterprise business will enable converged offerings to B2B-customers.

The acquisition will strengthen Telia Company’s position on the Norwegian market and will position the company as a strong challenger in mobile, TV and broadband.

“It is with great excitement and commitment that we announce the agreement to acquire GET and TDC Norway. It will create a leading convergent operator for both consumers and enterprises in Norway which can compete in the market with a lot of attractive and new products and services. This transaction is beneficial for the Norwegian customers and society. We are building a great company with passionate employees where we have invested heavily in our mobile network which now covers 98 percent of the country. As part of Telia Company, GET will continue to invest in the rollout of broadband and fiber,” says Johan Dennelind, President and CEO of Telia Company.

In 2017 GET and TDC Norway reported revenues of NOK 4 billion and EBITDA of NOK 1.7 billion. The purchase price of NOK 21 billion corresponds to an EV/EBITDA multiple of 12.1x based on 2017, and 9.0x including expected synergies. Telia Company expects to generate full run rate synergies of NOK 0.6 billion by 2021 from B2C and B2B cross-sales, churn reduction and other cost efficiencies. The acquisition is estimated to incur integration costs during 2019 and 2020 of approximately NOK 200 million annually.

“We have a history of successful acquisitions in Norway and I am fully confident that this transaction will be no exception. I’m very much looking forward to welcoming GET’s and TDC Norway’s employees and customers to Telia Company,” says Johan Dennelind.

This transaction puts our net debt to EBITDA pro forma at 1.9x i.e slightly below our target of 2x plus/minus 0.5x. Earlier communicated share buy-back program and dividend policy remains intact.

The acquisition of GET and TDC Norway is subject to approval from relevant authorities and is expected to be completed in the second half of 2018.

Bank of America Merrill Lynch, LionTree Advisors, EY and Simonsen Vogt Wiig acted as advisors to Telia Company in connection to the transaction.