UAE's e& expands central Europe presence with 825m euro deal

Dubai: A subsidiary of UAE's tech-telco group e& is expanding its reach into Europe by acquiring an Internet and cable TV services provider in Serbia. The deal is valued at 825 million euros.

SBB d.o.o. Serbia has over 700,000 active customers and 'strong' market offerings. Its 2023 revenues came to 244.1 million euros and with an EBITDAaL margin of 50%.

"This represents an incremental of 12% and 15% to e& PPF Telecom revenue and EBITDAaL respectively (based on FY 2023 financials)," said e& in a statement. (EBITDAaL stands for earnings before interest, taxes, depreciation and amortization and after lease expenses.)

The deal was overseen by e& PPF Telecom Group BV (e& PPF Telecom), a subsidiary of e&. (The e& stock is trading at Dh17.16 on ADX.)

This transaction will enable e& PPF Telecom to combine SBB with its existing Serbian mobile subsidiary Yettel, thus 'creating a leading converged operator offering enhanced mobile, fixed broadband and pay-TV services in a market with significant growth opportunities'.

It was October last that e& and Netherlands-headquartered PPF Group entered their partnership, with the former acquiring a controlling stake (50% plus one economic share) in the service and infrastructure companies of PPF Telecom Group across Bulgaria, Hungary, Serbia and Slovakia.

"This acquisition marks a significant step in e&'s ongoing global expansion ambitions, diversifying and growing its geographical presence to 38 countries," the UAE company said at the time.

The new 825 million euro transaction for SBB will be financed through debt, which will be raised by e& PPF Telecom. On completion, the financials of SBB will be consolidated into e& PPF Telecom’s.

"This acquisition aligns with e&’s strategic ambition to scale up e& international in Central Eastern Europe, diversify revenue sources with more exposure to stable currencies, and accelerate growth in e& PPF Telecom," the statement added.

"This strategic move is set to significantly enhance e& PPF Telecom operations by strengthening its market positioning in Serbia and overall competitiveness by allowing more comprehensive offerings to meet the evolving needs of its customers."