Chereads / I Become A Noble in England / Chapter 368 - Chapter 368 Acquisition of Czech Telecom

Chapter 368 - Chapter 368 Acquisition of Czech Telecom

"Dear, what are you thinking about?"

  "Nothing, honey, are you back from shopping?"

  Looking at Amanda sitting next to him and Lydia sitting opposite him, Barron asked with a smile on his face.

  "Yes, recently many brands have launched new spring styles. We bought some. How about putting them on and seeing them for you?"

  While Amanda was talking, the maids had already brought up their large and small bags, the "results" of their shopping today.

  "OK."

  In fact, what Barron was thinking about just now was his meeting with John Bogle, the founder of Vanguard Group, yesterday.

  If you think about it, Vanguard is the largest shareholder of investment companies such as BlackRock and State Street. At the same time, BlackRock and State Street also hold shares in two other groups...

  This is how many financial giants in America "unite" by holding shares in each other and forming a chain of interests.

  Not that Vanguard wants to do the same with Barron's companies - as Bogle said, that's after they have formed a trusting relationship.

  After all, DS Capital, even with its other industries combined, cannot be compared with these giants at the top of American and even global capital. In this case, holding shares in each other is meaningless and will instead result in Barron being "swallowed" by the other party.

  At present, Bogle's meeting with Barron, on the one hand, shows a "goodwill" attitude, and on the other hand, hopes to "cooperate" in many of Barron's projects. As for how to understand the two words goodwill and cooperation, I'm afraid we still need to speak with strength.

  But one thing is certain, that is, by joining them, certain restrictions in many areas that were originally difficult for him to enter will be broken.

  Like a double-edged sword, some of his industries naturally require allowing the other party to enter.

  At least for now, what they show is mostly literal "goodwill". After all, Barron has a lot of cooperation with Goldman Sachs at this time. However, it is not certain how long this "goodwill" can last, or how long their patience in intervening can last.

  Therefore, Barron now has more sense of urgency - no matter what, strengthening his own strength is the most important thing.

  …

  "We succeeded, Your Highness. The Czech side just announced that O2 Telecom has successfully acquired 51% of Czech Telecom's shares with a bid of 3.55 billion US dollars..."

  Even through the phone, Barron could still feel the excitement of O2 Telecom CEO Barry Trelles:

  "According to my private information, our bid this time is only $50 million higher than Telefonica's. They offered a price second only to ours at $3.5 billion. It's really a little thrilling..."

  OK, Czechs, you have won my respect. It seems that this time their bid for the privatization of Czech Telecom really has no "off-market factors". They just want to sell it for more money...

  This means that O2 Telecom has become the controlling shareholder of Czech Telecom and has acquired 51% of Czech Telecom's shares after paying US$3.55 billion.

  Then, within the next six months, they can make an offer to other shareholders of Czech Telecom and choose to acquire 100% of the largest fixed-line and mobile communications operator in the Czech Republic.

  This is indeed good news, but the question is how to raise the next round of funds?

  In this acquisition of 51% of Czech Telecom shares held by the Czech government, O2 Telecom chose Caesar Fund as its partner.  

  Their bid, which is $3.55 billion to be paid to the Czech government, will be matched by $3.5 billion from Caesars.

  These funds will be issued by O2 Telecom to Caesar Fund as convertible bonds with very low interest rates. However, O2 Telecom needs to complete its IPO within two years, and the $3.5 billion bonds will be converted into O2 Telecom's common stock at its public offering price.

  Therefore, the funds needed to purchase the 51% stake in Czech Telecom have now been secured.

  But if the company wants to complete the 100% acquisition of Czech Telecom, it will cost about $3.41 billion based on the current acquisition price...

  But this is not a problem. After all, given O2 Telecom's current debt ratio - they only have a debt of 2 billion pounds plus 3.5 billion US dollars, of which the 1 billion pounds of convertible bonds from the Saudi Public Investment Fund and the 3.5 billion convertible bonds from the Caesars Fund can be converted into company stocks after their IPO, thereby getting rid of these debts.

  Then the actual liability is only the initial 1 billion pounds of corporate bonds...

  Given O2 Telecom's current operating conditions, it is entirely possible for it to continue to raise funds to complete the acquisition of the remaining shares of Czech Telecom - it seems that the Royal Bank of Scotland is still preparing to continue investing in the Madoff Fund...

  They invested their own money in Madoff Fund, and Barron couldn't do anything about it, but if they were to waste the users' savings...

  The kind-hearted Barron still doesn't want to see such a situation, so he decided to hand over this business to them. O2 Telecom can use the acquired shares of Czech Telecom as collateral in exchange for financing from the Royal Bank of Scotland - of course, it must be borrowed in pounds sterling.

  Next, at Barron's instruction, O2 Telecom CEO Barry Trelles began contacting the Royal Bank of Scotland to discuss financing.

  I once met a senior executive of the Royal Bank of Scotland at a financial cocktail party in London. The executive once jokingly complained that DS Capital's previous financing was mostly in cooperation with Barclays Bank, and they also hoped to cooperate with DS Capital.

  Now, Barron has been able to fulfill every request...

  As for O2 Telecom's IPO plan, Barron has also communicated with O2 Telecom's management. They plan to start O2 Telecom's listing process in a year, around this time next year, after consolidating the current markets in Britain, Ireland, France and Germany, and digesting the Czech market where the newly acquired Czech Telecom is located.

  By then, it will be exactly three years since Barron's acquisition of O2 Telecom. O2 Telecom will fully meet the conditions for listing on the main board of the London Stock Exchange without any exceptions.

  And I'm afraid that based on O2 Telecom's financial data and its valuation by then, it will also be satisfactory - it will be a huge IPO project.

  After reaching a financing agreement with the Royal Bank of Scotland for a total of 2 billion pounds and an annual interest rate of 4.5%, O2 Telecom, as the controlling shareholder of Czech Telecom with a 51% stake, made a full acquisition offer to the remaining shareholders, intending to purchase the shares of other shareholders at the same price they had previously paid for the shares held by the Czech government.

  As mentioned before, when O2 Telecom was bidding, its offer of $3.55 billion was much higher than their valuation of Czech Telecom. Therefore, according to this price, the acquisition offer to other shareholders also had a considerable premium...

  From the attitudes of many other shareholders of Czech Telecom that they surveyed, most of them were positive about the bid.

  Once the voting results are announced in half a month, it will be determined whether O2 Telecom can complete the acquisition offer.