Polkomtel plot thickens

The $6bn Polkomtel sale saga looks set to take an interesting turn this week with reports that last-minute squabbling between shareholders could derail the whole process. When news of the impending sale was first announced, many observers pointed to the fragmented nature of the telco’s ownership as a potential roadblock to achieving a smooth sale. On Tuesday, Reuters  reported that sources close to the deal are saying the involvement of state-owned shareholderrs with differing views on how the transaction should go ahead are putting the whole venture at risk.

Political concerns surrounding the involvement of Polish media mogul and Forbes rich-list regular Zygmunt Solorz-Zak are also said to be creating controversy; needing to raise funds to fill a $13bn-sized hole in its budget, government politicians are said to fear for their chances in forthcoming elections should Solorz-Zak be successful.

Polkomtel, which operates as Plus in Poland, is owned by five shareholders, among them Vodafone. The latter’s 24.4 per cent stake in the Polish telco entitled it to first-refusal on the remaining shares, but the company is keen to divest; last year, it separated its Polkomtel shareholding out from the rest of its European division. In addition to Solorz-Zak, TeliaSonera, private-equity firm Apax and a joint venture of Telenor and Bain capital are bidding for the telco. The companies have until June 10^th to complete due diligence but there is speculation now that at least one of the current shareholders will seek to retain its holding, meaning that bidders will only be able to compete for a controlling stake in the company. Should talks be protracted, bidding costs are likely to rise, and, with them, the likelihood of at least one of the bidders walking away. It is understood that while Vodafone and heavily-indebted shareholder PKN Orlen are keen to sell, KGHM Polska Miedz, which holds 24.4 per cent, wishes to retain its holding, which it views as a stable source of income.

With each of the selling and bidding parties having their own advisors and negotiators, the deal looks set to become increasingly complicated.