Press Releases

Matáv led consortium to acquire majority stake in Maktel

Budapest, December 21, 2000

MATÁV (NYSE: MTA.N and BSE: MTAV.BU) is pleased to announce that the Matáv led consortium has won the tender to acquire 51% of Makedonski Telekommunikacii (Maktel), the incumbent telecom operator in Macedonia, for a price of 362.5 million euros.

Elek Straub, Chairman and CEO of MATÁV said: "We are very pleased that the Macedonean government voted for us. We are enthusiastic about the deal and are keen to leverage our expertise in building up a state-of-the-art telecommunication network and providing high quality services for customers. This is an excellent transaction for MATÁV providing further growth opportunities to our shareholders."

The winning consortium will invest 255.7 million euros over the next two years to ensure broad popular access to affordable voice services, bring Macedonean population online, provide wide range of mobile voice, data and internet services and modernize customer service functions.

Matáv's 317.3 million euro stake of the purchase price will be financed from debt provided by Deutsche Telekom. Financial closing will take place on January 11. MATÁV will fully consolidate Maktel in its accounts from the time of the closing of the transaction.

The members of the winning consortium are MATÁV with a 87.4% stake, the Southeast Europe Equity Fund (SEEF) with a 6.3% stake and the Interamerican Holding with a 6.3% stake. SEEF is a newly established private equity fund managed by Soros Private Funds Management and partly financed by the Overseas Private Investment Corporation (OPIC). OPIC is a US Government organisation that supports US overseas investments by providing loans, guaranties and insurance. Listed on Athens stock exchange, Interamerican is one of the largest providers of insurance and financial services, as well as one of the largest alternative telecom operators (via its subsidiary CosmoTelco) in Greece.
MATÁV will take operational, management and voting control of Maktel once the purchase is completed.

Maktel is the sole fixed line and mobile operator in Macedonia with 500,000 fixed line and 86,000 GSM subscribers as of October 30, 2000. In the first nine months of 2000 Maktel had revenues of 8.7 billion denars (146.2 million euros) and net income of 2.9 billion denars (48.7 million euros).

MATÁV is the principal provider of telecom services in Hungary and holds the national concession for national and international long distance telephony. MATÁV provides a broad range of services including telephony, data transmission, value-added services, and through its subsidiaries is Hungary's largest mobile telecom provider. Key shareholders as of September 30, 2000 include the Hungarian State (holder of the Golden Share), MagyarCom, owned by Deutsche Telekom AG (59.49%), while 40.51% is publicly traded.