Telefonica Czech Republic will scrap 10% of its jobs over the coming year. While the operator is currently struggling, the redundancies actually date back to a 2011 restructuring initiative and are not related to investment group PPF’s recent bid for a majority stake.
PPF, owned by Czech billionaire Petr Kellner, has received approval for its bid from the European Commission. The group is aiming to finalise an agreement to acquire 66% of Telefonica Czech Republic by the end of this month. The €2.47 billion deal was first disclosed in November 2013.
Once the deal has closed, PPF is obliged to make an offer for the remaining shares in the operator – with the exception of the 4.9% that Telefonica will retain. The acquisition is something of a gamble for Kellner, although he certainly has the financial clout to reverse the ailing operator’s fortunes.
At the end of Q4 2013, Telefonica Czech Republic had slightly over 5 million connections, as well as around 1.5 million in Slovakia. While this technically puts it in second place, it faces strong competition from a further three operators, while the market is fairly small.