Skip to main navigation

Inside Telecommunications: Global roundup of mergers and acquisitions activity - EY - Global

Inside Telecommunications: 2Q 2012 trends

Global roundup of mergers and acquisitions activity

  • Share

Figure 8. Top telecoms M&A by deal value, Q2 2012

Figure 9. Telecoms M&A deal value by area, Q2 201

Asia-Pacific Q2 2012 M&A summary

The EMEIA region led transaction activity and deal value for the quarter.

Deal activity rises in Q2

Globally, deal activity in the sector increased in the Q2 compared to the first quarter of 2012. Total deal value reached US$18.5 billion, up from US$13.8 billion in Q1 2012. Average deal value increased quarter-on-quarter to US$203 million, up from US$178 million in Q1 2012. The number of announced deals stood at 91, down from 177 in the three months to March.

The Europe, Middle East, India and Africa (EMEIA) region led in transaction activity, with deal value outstripping all other regions combined. Changes to the ownership structure of the number two Russian mobile operator MegaFon have produced the quarter’s most sizeable deals.

Figure 8. Top telecoms M&A by deal value, Q2 2012

Source: ThomsonOne, accessed July 2012

Operators step sideways into mobile growth segments

The three months to June also saw operators boost their credentials in new industry growth areas. In May, US-based Verizon Communications purchased Hughes Telematics in a US$612m all-cash transaction. The deal expands Verizon’s presence in the automotive and fleet telematics market, and follows the establishment of a new Verizon division focused on telematics.

In May, DoCoMo Deutschland launched a US$209m tender offer for Italian mobile content company Buongiorno. The acquisition combines DoCoMo’s strong heritage in value-added services with Buongiorno’s advanced mobile technologies and extensive global customer base.

Overseas players take aim at European incumbents

In the second quarter, América Móvil completed a series of stake increases in KPN, the Dutch incumbent. Over the space of a month, the Mexico-based mobile group achieved its targeted 27.7% stake in three separate moves, despite initial opposition from KPN management.

In June, América Móvil also upped its holding in Telekom Austria to 23%.

In May, Hong Kong-based Hutchison Whampoa made a US$2.6b bid for Eircom, the Irish incumbent under bankruptcy protection. However, the Hong Kong group lost a motion to have its bid given due consideration in an Irish court.

Figure 9. Telecoms M&A deal value by area, Q2 2012

Figure 9

Source: ThomsonOne, accessed July 2012

Asia-Pacific Q2 2012 M&A summary

Figure 10

Source: Mergermarket, Telecom Asia and Factiva

Established players hunt opportunities across TMT

In recent quarters, operators in developed markets have proved themselves more ambitious than their Western counterparts in seeking acquisitions beyond their core activities.

As carriers consider boosting their credentials in the content market, TV players are also being sized up as acquisition targets. Although no deals were announced during the quarter, according to press reports PLDT in the Philippines is reportedly interested in a controlling stake in GMA Network.i

In June, KT Corp. dropped plans to acquire a 20% stake in South African incumbent Telkom due to opposition from the South African government. For more detail about Asia-Pacific deal activity in 2Q 2012, please download the full report.

Vietnam’s mobile market structure

In the latest move to reorganize Vietnam’s telecoms sector, the state-owned VNPT revealed plans in June to merge its two mobile subsidiaries, MobiFone and VinaPhone. A new regulation issued last year stipulated that an investor with more than a 20% stake in one operator cannot own more than 20% of another.

Vietnamese military-owned mobile operator Viettel officially took control of the telecoms arm of state-owned Electricity of Vietnam in May, according to local press reports. Last year, an attempt to sell a 49% stake in EVN Telecom fell apart, after prospective purchaser Corporation for Financing and Promoting Technology pulled out of the deal.

In April, Russia-based Vimpelcom announced it was selling its indirect 49% stake in GTEL to local partner Global Telecommunications Corporation for US$45m. Having already written down the value of its stake at the end of last year, Vimpelcom has decided to exit Vietnam to focus on more promising opportunities.


<< Previous


iThe Australian, “PLDT in talks to acquire stake in broadcaster GMA Network,” 18 June 2012.

Contents

Subscribe

Download Inside Telecommunications: 2Q 2012  as a printable document

Previous editions

Contact us

Back to top