ÖIAG and Telekom Austria agree with Telecom Italia on purchase of stake in Mobilkom Austria and Telecom Italia’s exit from Telekom Austria (Ad hoc Release)
Vienna, June 7, 2002: ÖIAG (Österreichische Industrie Holding AG) and Telekom Austria (VSE:TKA; NYSE: TKA) announced the following agreements with Telecom Italia:
Vienna, June 7, 2002: ÖIAG (Österreichische Industrie Holding AG) and Telekom Austria (VSE:TKA; NYSE: TKA) announced the following agreements with Telecom Italia:
- Telekom Austria acquires TIM’s 25% stake in Mobilkom Austria for a total consideration of €716 million, out of which €26 million represent the dividend for the year 2001.
- Telecom Italia and ÖIAG adjust the existing shareholder agreement to allow for a gradual and co-ordinated exit of Telecom Italia and further privatisation steps of ÖIAG.
Acquisition of Mobilkom Austria
Telekom Austria will acquire TIM’s 25% stake in Mobilkom Austria through the acquisition of 100% of Autel. Autel is a holding company wholly owned by TIM whose only asset is a 25% stake in Mobilkom Austria.The purchase price for Autel consists of €690 million in cash and €26 million which TIM recieves as dividend for the year 2001.
The transaction gives Telekom Austria full control of Mobilkom Austria and thus full access to its strong cash flows. Furthermore, the 100% ownership of Mobilkom Austria increases Telekom Austria’s future strategic flexibility. The acquisition does not require clearance by the relevant antitrust authorities and is expected to close before the end of June 2002.
To reflect the importance of Mobilkom Austria and its status as a fully integrated part of Telekom Austria Group, Boris Nemsic will be appointed a member of Telekom Austria’s Management Board alongside Heinz Sundt, Stefano Colombo and Rudolf Fischer. Mr. Nemsic is responsible for the Group’s wireless business and he will retain his current position as CEO of Mobilkom Austria.
Adjustment of the shareholder agreement between Telecom Italia and ÖIAG
In conjunction with the Mobilkom Austria Transaction, Telecom Italia and ÖIAG have adjusted the existing shareholder agreement.Upon signing of the agreements, Telecom Italia loses a number of special shareholder rights as well as its management nomination rights. These rights were originally granted to Telecom Italia to reflect its role as a strategic partner of Telekom Austria.
In exchange, the existing share transfer restrictions have been replaced by a new agreement that allows for a gradual and co-ordinated exit by Telecom Italia and further privatisation steps by ÖIAG. While both parties will continue to review strategic alternatives for their stakes in Telekom Austria, the parties will have the rights to increase the free float and liquidity of Telekom Austria in the following way:
- Telecom Italia will have the right to dispose of up to 75 million shares (15% of Telekom Austria’s share capital) in a public market transaction in the second half of 2002.
- During 2003, ÖIAG will have the right to place the first 25 million shares (5% of Telekom Austria’s share capital) of any offering. Telecom Italia will then have the right to sell any residual shares of the 75 million shares authorized for sale in the second half of 2002.
- For any shares sold thereafter in a public market transaction, Telecom Italia and ÖIAG have the right to sell an equal number of shares.
- All such disposals will be subject to customary lock-up provisions.
Upon disposal of at least 50 million shares (10% of Telekom Austria’s share capital), but in any case no later than 30 April 2003, Telecom Italia will lose any remaining special shareholder rights and the two Telecom Italia nominated supervisory board members will subsequently be replaced by two independent shareholder representatives.
In parallel to any public market transaction, ÖIAG and Telecom Italia retain the right to sell shares in private transactions. In Telecom Italia’s case, such sales are subject to the consent of ÖIAG. In case of sales by ÖIAG, Telecom Italia’s shares must be included in the transaction.
At the next ordinary shareholders meeting of Telekom Austria on 12 June 2002, ÖIAG and Telecom Italia shall vote in favor of the conversion of all registered shares into bearer shares.
Contact:
Hans Fruhmann
Head of Investor Relations of Telekom Austria
Tel: +43 (0) 59059-1-20917
E-mail: hans.fruhmann@telekom.at
Merrill Lynch acted as Financial Advisor to ÖIAG and Lehman Brothers acted as Financial Advisor to Telekom Austria on this transaction.
Vienna, June 7, 2002: ÖIAG (Österreichische Industrie Holding AG) and Telekom Austria (VSE:TKA; NYSE: TKA) announced the following agreements with Telecom Italia:
- Telekom Austria acquires TIM’s 25% stake in Mobilkom Austria for a total consideration of €716 million, out of which €26 million represent the dividend for the year 2001.
- Telecom Italia and ÖIAG adjust the existing shareholder agreement to allow for a gradual and co-ordinated exit of Telecom Italia and further privatisation steps of ÖIAG.
Acquisition of Mobilkom Austria
Telekom Austria will acquire TIM’s 25% stake in Mobilkom Austria through the acquisition of 100% of Autel. Autel is a holding company wholly owned by TIM whose only asset is a 25% stake in Mobilkom Austria.The purchase price for Autel consists of €690 million in cash and €26 million which TIM recieves as dividend for the year 2001.
The transaction gives Telekom Austria full control of Mobilkom Austria and thus full access to its strong cash flows. Furthermore, the 100% ownership of Mobilkom Austria increases Telekom Austria’s future strategic flexibility. The acquisition does not require clearance by the relevant antitrust authorities and is expected to close before the end of June 2002.
To reflect the importance of Mobilkom Austria and its status as a fully integrated part of Telekom Austria Group, Boris Nemsic will be appointed a member of Telekom Austria’s Management Board alongside Heinz Sundt, Stefano Colombo and Rudolf Fischer. Mr. Nemsic is responsible for the Group’s wireless business and he will retain his current position as CEO of Mobilkom Austria.
Adjustment of the shareholder agreement between Telecom Italia and ÖIAG
In conjunction with the Mobilkom Austria Transaction, Telecom Italia and ÖIAG have adjusted the existing shareholder agreement.Upon signing of the agreements, Telecom Italia loses a number of special shareholder rights as well as its management nomination rights. These rights were originally granted to Telecom Italia to reflect its role as a strategic partner of Telekom Austria.
In exchange, the existing share transfer restrictions have been replaced by a new agreement that allows for a gradual and co-ordinated exit by Telecom Italia and further privatisation steps by ÖIAG. While both parties will continue to review strategic alternatives for their stakes in Telekom Austria, the parties will have the rights to increase the free float and liquidity of Telekom Austria in the following way:
- Telecom Italia will have the right to dispose of up to 75 million shares (15% of Telekom Austria’s share capital) in a public market transaction in the second half of 2002.
- During 2003, ÖIAG will have the right to place the first 25 million shares (5% of Telekom Austria’s share capital) of any offering. Telecom Italia will then have the right to sell any residual shares of the 75 million shares authorized for sale in the second half of 2002.
- For any shares sold thereafter in a public market transaction, Telecom Italia and ÖIAG have the right to sell an equal number of shares.
- All such disposals will be subject to customary lock-up provisions.
Upon disposal of at least 50 million shares (10% of Telekom Austria’s share capital), but in any case no later than 30 April 2003, Telecom Italia will lose any remaining special shareholder rights and the two Telecom Italia nominated supervisory board members will subsequently be replaced by two independent shareholder representatives.
In parallel to any public market transaction, ÖIAG and Telecom Italia retain the right to sell shares in private transactions. In Telecom Italia’s case, such sales are subject to the consent of ÖIAG. In case of sales by ÖIAG, Telecom Italia’s shares must be included in the transaction.
At the next ordinary shareholders meeting of Telekom Austria on 12 June 2002, ÖIAG and Telecom Italia shall vote in favor of the conversion of all registered shares into bearer shares.
Contact:
Hans Fruhmann
Head of Investor Relations of Telekom Austria
Tel: +43 (0) 59059-1-20917
E-mail: hans.fruhmann@telekom.at
Merrill Lynch acted as Financial Advisor to ÖIAG and Lehman Brothers acted as Financial Advisor to Telekom Austria on this transaction.
