Pakistan Telecommunication Company Limited (PTCL) has formally signed a Share Purchase Agreement (SPA) with Telenor Pakistan shareholders, marking its intent to acquire the entirety of Telenor Pakistan’s shares. The deal, valued at an enterprise value of Rs108 billion, will be executed on a cash-free, debt-free basis. PTCL intends to finance the acquisition through external debt.
Telenor Pakistan, a prominent mobile operator catering to 45 million subscribers, has reported revenues of Rs112 billion and an EBITDA margin of 43% in the last twelve months (LTM) as of September 2023. The transaction is poised to drive in-market consolidation within the telecom sector, promising a positive long-term industry outlook.
PTCL’s major assets include Ufone, a significant mobile operator in Pakistan boasting over 20 million customers. Telenor Group, in a press release, emphasized that this sale aligns with its strategic vision to build scale and establish market-leading entities in Asia.
As part of Telenor Group’s 2022 Capital Markets Day presentation, this strategic move concludes the review of telecom operations in Pakistan, initiated in July 2022. The transaction values Telenor Pakistan at NOK 5.3 billion on a cash-and-debt-free basis.
CEO of Telenor Group, Sigve Brekke, stated, “By selling to the country’s largest integrated ICT company, we believe this consolidation move will help strengthen Pakistan’s telecoms sector, creating opportunities in new areas of growth to the benefit of consumers in Pakistan.”
The Head of Telenor Asia, Petter-Børre Furberg, expressed confidence in the strategic decision, emphasizing the commitment to fostering number one positions in markets for value creation and sustainable growth. The sale is expected to be completed in 2024, pending regulatory approvals and customary conditions.
Telenor Pakistan is expected to continue normal operations, delivering services to its 45 million customers throughout the transition period.
