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Telekom Austria moves into Bulgarian cable market

Telekom Austria has acquired 100% ownership of Bulgarian cable and telecom operators Megalan Network and Spectrum Net via its local subsidiary Mobiltel.

The deal, which gives the two operators a debt-free value of €83m, will see new product bundles launched under the M-Tel brand this year. According to Telekom Austria, local management of both operators will remain in place to ensure a smooth transition and the companies will continue to operate as separate entities for the next 18 months.

The acquisitions will allow Mobiltel to become a converged operator with both fixed and mobile networks. Megalan is the leading broadband provider in Sofia and also offers IPTV services, while Spectrum Net is focused on the business customer market. The two companies had 85,400 access lines at the end of last year and generated €25.3m in revenues and EBITDA of €7m.  Telekom Austria expects EBITDA to grow to €9.6m this year, giving the value of the deal an EBITDA multiple of about 6.8.