Forthnet, the Greek telecoms company in which a Go plc joint venture has a 41 per cent stake, is currently engaged in talks with other players in its market with a possible view to “co-operation”, according to Greek media.
Last week, the Greek newspaper Kathimerini illustrated how the challenging economic climate, shortage of capital, and the overcrowding of the telecom market may lead to possible mergers this year.
The report said talks involving companies including Forthnet, Cypriot-based CYTA Hellas, and Hellas on Line were being scrutinised by the Greek National Regulating Agency.
“These talks, in all probability, may result to some of the existing companies – most of them with considerably high debt – merging and thus decreasing the amount of suppliers operating in the Greek telecom market, hopefully through synergies, streamlined costs and improved efficiencies,” the report said.
“In the last 12 to 18 months, a number of alternative Greek telecom providers including mobile/fixed operator Wind Hellas – which has had its share of debt tribulations – which also includes the brand name of Tellas and Q Telecom, have engaged in exploratory discussions that may lead to a convergence of operations, gathering of resources and rationalisation of assets and other capital factors.”
Forgendo, the vehicle jointly held by Go plc and its major shareholder Emirates International Telecommunications (Malta Limited), increased its shareholding in Forthnet to 40.71 per cent just before Christmas.
Go’s interim balance sheet last September bore the brunt of a €7.3 million loss from its share of results in the investment in Forthnet which at the time stood at 39.9 per cent.
Kathimerini observed that one of the main stumbling blocks in these discussions was disagreement among the players: Greek alternative telecom providers, acknowledging the need for some sort of operation convergence, disagree on which will assume what role.
Previous convergence efforts between Cyta Hellas and On Telecoms as well as Hellas on Line Hol and Forthnet failed because of such trifles and tribulations, the report said.