Following a marathon ten-hour meeting, shareholders of fixed and mobile operator O2 Czech Republic approved a plan to spin off the group’s combined infrastructure assets – which currently generate about half of the group’s total operating profits – into a new non-listed entity called CETIN, leaving the rump of O2’s operational business as a publicly-listed operator offering a range of voice, data and TV services. In a move designed to revive the firm’s flagging fortunes, the telco confirmed that under the plan O2 shareholders will each be given one share in the new firm for every O2 share, while shareholders who voted against the move have the right to offload their shares in the new company, in a buyout offer for a price to be determined by an audit; industry watchers estimate the value will be approximately CZK150 (USD5.96) per share, based on a previous valuation of CETIN for the purposes of the separation. It is understood, however, that a large number of minority stockholders argued against the split, which they see as devaluing their investment in the group. The final price will be announced after the split, expected on 1 June 2015.
As previously reported by CommsUpdate, earlier this month O2 Czech Republic CFO Toms Koura confirmed that O2 and CETIN were roughly equal in terms of their contribution to operating earnings as well as operating cash flow. In terms of net profit, however, the former accounted for about 80% in FY 2014, due to higher write-offs at CETIN, which was provisionally valued at CZK46.9 billion at that time. The Czech company is currently 83% owned by billionaire Petr Kellner’s PPF Group.