Speculation that Turkcell was seeking to acquire a stake in Bulgarian operator Vivacom have been confirmed by the Turkish operator.
Turkcell has stated that it will acquire a 93.99% holding in Vivacom without disclosing the sum it will pay for these assets. Previous reports indicated that this figure could be around US$1.4 billion, but Turkcell has dismissed such speculation as “groundless”.
At the end of 2011, Vivacom’s market share was 17.4%, making it the smallest mobile operator in Bulgaria. The firm also provides fixed-line services.
Three parties have already bid for a stake in Vivacom, including Pamplona Capital Management and a consortium between the Bulgarian Corporate Commercial Bank and Russian investment bank VTB Capital. The third bid comes from Thor Bjorgolfsson, an Icelandic investor who previously owned Vivacom, and is currently bidding in alliance with Greek firm Germanos.
If Turkcell is planning on using its cash reserves to finance its bid, it would likely face difficulties in its home market brought about by “limited financial flexibility”, according to the ratings agency Fitch.