(Nordic Business Report via NewsEdge) Norwegian telecom group Telenor has signed a definitive agreement to sell its Telenor Satellite Services unit to funds managed by the private equity group Apax Partners.
Apax Partners is paying 2.4 billion kroner ($403.4 million) in cash for the operations, which will result in a gain of approximately 1.4 billion kroner ($213.9 million) for Telenor.
Telenor Satellite Services provides mobile satellite communication services worldwide. It has 550 employees and operations in Europe, the US, the Middle East, Asia and South America. It posted revenues of 2,4 billion kroner ($403.4 million) in 2005.
Telenor said it had regarded Telenor Satellite Services as a non-core business for several years. The unit did not own or operate satellites by itself, and the divestment would not affect other Telenor units that used satellites, such as Telenor Satellite Broadcasting.
"Apax Partners is a very capable owner, and the sale of Telenor Satellite Services is made in accordance with Telenor's strategy to divest business operations that fall outside the scope of our core activities. We are pleased that Telenor Satellite Services will now have an owner that is well positioned to continue the development of the company," said Bjarne Aamodt, chairman of Telenor Satellite Services and senior vice president of Telenor.
Telenor said the buyer intended to continue developing Telenor Satellite Services in Norway and abroad.
Meantime, in its recently issued third quarter report, Telenor said it posted an operating profit of 5.3 billion kroner ($809.9 million) from 3.5 billion kroner ($534.9 million) in the same period last year.
Revenues amounted to 23.9 billion kroner ($3.7 billion), up from 17.6 billion kroner ($2.7 billion) a year ago. Earnings per share improved from 1.30 kroner ($0.20) to 2.25 kroner ($0.34).
Its strong third quarter performance prompted Telenor to increase its expectations for the entire year. It did not disclose the new guidance numbers, however.
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