Merger and acquisition activity is surging in the telecom sector, with several significant deals underway and confidence in the sector tipped to grow in the year ahead, say industry experts.
Amidst the busiest start to a year for TMT M&A since 2000*, leading telecom and tech executives, bankers and professional advisors are meeting in London at the annual TMT M&A Forum 2013 (www.tmtfinance.com/merger) on 14 March, to discuss the latest opportunities.
International cable operator Liberty Global’s US$23bn bid for UK based Virgin Media, and the US$24.4bn deal taking PC-maker Dell private, are the standout deals in the sector so far this year. However many others are being talked up now. AT&T and China Mobile are both also rumoured to be looking at major global acquisitions, while sizeable assets such as Vivendi’s majority stake in Maroc Telecom are also on the block.
Additional M&A transactions are likely to continue in 2013, with mobile operator consolidation and the transition to 4G also likely to dominate telecom financing in the year ahead, according to Torsten Thiele, Head of Telecoms Project Finance, Investec Bank, who will be speaking on the Financing Panel at the TMT M&A Forum.
“4G rollouts will require significant investment, so that’s one of the key areas I expect to see influencing the year ahead. There is also additional infrastructure being built, so there will be financing related to that. In Africa, for example, there is the need to increase inshore networks – there are subsea cables along the coast, but now you need additional cables to go into the core of the continent,” he said.
Meanwhile, Viktor Kovács, founder of cloud technology and services hub Neostratus, who will be speaking on this issue on the Future of TMT Panel at the conference, said: “Telcos must also assess how best to evolve from the pure provision of network to the delivery of comprehensive IT and communications services.”
“In order to take advantage of this market transformation, the need for smart partnerships and alliances has grown dramatically,” said Kovács. “The service providers who are doing to the best to overcome hyper-competition and price erosion are the ones who have built the services eco-systems required to reduce infrastructure cost while effectively becoming one-stop shops for customers’ IT and communications needs.”
The TMT M&A Forum brings together leading executives, advisers, investors and financiers from across the world to discuss the latest opportunities for transactions and partnerships. Etisalat, Altimo, T-Mobile Austria, Everything Everywhere, Abertis, Huawei and Vivendi’s SFR are among the industry speakers announced for the event so far. Financial institutions speaking include regional and sector heads from UBS, JP Morgan, Credit Suisse, Citi, Arcus Infrastructure, Standard Bank, Investec Bank, Santander Global Banking and Markets, European Bank for Reconstruction and Development (EBRD) and BNP Paribas.
For programme information go to: www.tmtfinance.com/merger
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