Telecoms flooded the market with mergers and acquisitions

The total volume of all transactions in the Russian sphere of M & A in 2010 amounted to 51.9 billion euros, and every fifth euro fell on the sector TMT (technology, media and telecommunications). These data are presented in the study of international law firm CMS. One of the largest acquisitions of the year was the main operator "Synterra", which, given the cost of debt "MegaFon" in the $ 745 million Transactions, "migrated" to the regions. Agency J'son & Partners Consulting report that the number of deals regions far ahead of the center. Thus, in Moscow the 10 transactions in St Petersburg - only 4, but in CFD - 15, in North-West - 12. Considerable interest was the Volga Federal District - 7 transactions. Along with the CFA, "record" was the number of acquisitions, inter-operator - also 15. This layout is simple: purchase made in the calculation of the potential customer base in the region, while Moscow with Peter saturated by services and communications, and Internet access. Prosaic beginning. Experts J'son & Partners believe that the impetus for warming up M & A in post-crisis movement sector were telecommunications assets AFK "System". In mid-February 2010 "Comstar-Regions" has acquired 100% of alternative operator from Yaroslavl 'TenzorTelekom "for $ 7.3 million, or 4,7 EBITDA for 2009. By mid-year active all the major operators, and for the most attractive assets a struggle. For example, the "Pensa-Telecom" claimed "VimpelCom", "Comstar-Regions", "Svyazinvest". As a result, in mid-June "Comstar" acquired 100% of the company for $ 19.9 million, or 7,6 EBITDA. In July, MTS acquired "Multiregion" for $ 218 million, or 8,8 EBITDA. In November, "VimpelCom" bought Urals alternative fixed-line operator "Foratek Kommunikeyshn" for $ 1.4 billion. According to the analyst's "Metropole" Sergei Libin, the deal passed by a factor of 7,4 EBITDA. In December, "Comstar" bought the St. Petersburg "Lanck Telecom" for 7,5 EBITDA, a "multi-Novosibirsk company" - for 725 million rubles, or 8,2 EBITDA. President of "Rostelecom" Alexander said Provotorov very good bargain purchase "Svyazinvest" of the owner a large operator of Tatarstan Teleset Networks PCL about 7 EBITDA. "We are successful" big three "participated in M ​​& A, - he explains, including giving an example of Teleset. - You paid a high price for "National Telecommunications", but this is the best asset in the market, and synergy justifies the price. A "big three" acquires assets in small areas. " Assets bought not just so, and to further convergence. Life is a cable internet provider after the merger with mobile operator changes, it requires additional investment in network integration, IT-systems, billing systems. "When you merge a small player in the broadband access to mobile operator costs for the combination of business processes can be as low as $ 1 million, and in the case of the integration of major fixed business costs cellular operator can reach tens of millions of dollars" - assesses the scale of "disaster" Director of the Department of integration and business development for MTS Vladimir Hrenkov. But the competition has its limits. Moscow's major operator of broadband Internet access "Akado" became the object of desire of several operators. By turns thought about buying it "Megaphone", "Svyazinvest". But Yuri Pripachkin and "Renova" (owners of the asset) have decided to sell "Akado" on the crest of demand, and private buyers retreated. Finally, "Center Telecom" announced the official estimate of the asset at 11 EBITDA and began to prepare for the absorption. It's not lost his nerve Director General of "Svyazinvest" Evgeny Yurchenko ("Center Telecom" was by the state operator of inter-regional), and the deal is canceled. As a result, the largest player in the capital market continues to wait for a buyer. Typically, transactions are conducted using borrowed funds. "The use of credit in Russia for investment, including financing transactions M & A, - not the best option in terms of the financial health of the enterprise. This often leads to bankruptcy, because we are too costly loans. But now, unfortunately, we see a trend output from the business of their own funds to foreign bank accounts, buying real estate, etc. and replace them credit resources, regardless of how much these loans are worth. This is a disturbing trend "- warns Partner, Director of Corporate Finance," Grant Thornton "Ivan Sapronov. The bird of luck. The activity of the operators did not go unnoticed for investment companies. They are joined after the heating stage, and because their transaction was at an unprecedented high rate. For example, in October 2010, the fund Baring Vostok Capital Partners has acquired 10% of the provider of Internet access, "ER-Telecom". According to J'son & Partners Consulting, the company has been evaluated for the deal in 16 EBITDA for 2010. But in large transactions rates were still lower. In the first quarter of the appetites of the major players began to decline. In April, MTS bought Barnaul ISP "Inteleka" for 5,3 EBITDA. "VimpelCom" has acquired the St. Petersburg statement "Eltel" over 1 billion rubles. Experts estimate the market value to EBITDA ratio is about 5.5. Experts CMS believes that only in 2011 in the sector TMT will be the order of 50 deals M & A, and this sector will be the driving force of mergers and acquisitions market. Director of Development of broadband access "VimpelCom" Dmitry Malov sees on regional markets dozens of companies that would be interested to purchase. Perhaps if the owners will be more compliant, a year marked by the sale of "Akado". The same "ER-Telecom" with a share of the Russian broadband market by 8.5% and cable television in 8.3% (by his own estimation of the company) - a piece of cake. MTS and "Megaphone" is aimed at NetByNet (about 450 thousand subscribers in Moscow and Moscow region), the resolution of FAS has already been received by both companies. The Russian purchase "big three" state operator and operator of shopping in 2010 totals Shopping acquisitions in 2011 (cost, performance), Rostelecom / Svyazinvest Teleset Networks PCL, National Telecommunications + 160 thousand fixed-line telephony, 4.5 million + MTS subscribers fixed broadband Eurotel, TenzorTelekom, management and leasing, Penza-Telecom, Multiregion, Lanck Telecom, Novosibirsk Multiservice Company + 19.5 thousand km of gas networks; + 350 thousand subscribers fixed broadband Information Centre ($ 15.6 million, 34 thousand . callers) Inteleka (188 thousand subscribers) Megaphone Synterra + 75.5 thousand km of gas networks VimpelCom Foratek Kommunikeyshn, Polarkom + 1.45 thousand km of gas networks; + 5 thousand subscribers fixed broadband Eltel (1 billion, 34 thousand subscribers)