New Street: KPN (Buy, TP: €3.7, +33%) Tele2 (Buy, TP: SEK145, +10%) T-Mobile NL sale to Apax and Warburg Pincus - thoughts & implications
DT has announced today the sale of T-Mobile Netherlands (DT 75% stake, Tele2 25% stake) to a consortium of Apax and Warburg Pincus for a price of €5.1bn – which is exactly in line with our prior valuation, and equates to a multiple of 7.9x 2021E EV/ EBITDAaL. In this blog, we look at the implications of a sale to KPN and Tele2, the sector as a whole, and the likeliehood of a fibre roll-up strategy or fibre JV with KPN.
Koninklijke KPN is an integrated information and communications technology service provider. Co. provides its consumer customers data broadband services, IPTV services, mobile (voice, data and SMS) and fixed line telephony. Co. provides its business customers broadband services, mobile, fixed line and data services. Co. operates in the following segments: Consumer Mobile, which provides mobile services and products; Consumer Residential, which provides services in and around the house; Business, which provides fixed and mobile telephony services; NetCo, which includes fixed wholesale services; Belgium, which provides mobile telephony; and iBasis, which provides wholesale network services.
Tele2 is engaged as a telecom operator. Co. provides mobile communication services, fixed broadband and telephony, data network services and content services. The mobile service comprises various types of subscriptions for residential and business customers as well as prepaid cards. Fixed broadband includes direct access, which is its own services based on access via copper cable and other forms of access, such as fibre networks, wireless broadband and metropolitan area networks. Fixed telephony includes resold products within fixed telephony. The product portfolio within resold fixed telephony consists of prefix telephony, pre-selection (dial the number without a prefix) and subscriptions.
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