Swisscom Intends to Buy 75% Stake in Telecom Liechtenstein
Swisscom and the Principality of Liechtenstein signed a declaration of intent for the company to buy a 75 percent stake in Telecom Liechtenstein, Bern-based Swisscom said today in a statement.
Swisscom said it’s committing itself to invest in one of the world’s smallest countries, where the Liechtenstein government says it’s difficult to make the business profitable given the number of clients and level of investments needed. The landlocked principality had a population of about 36,000 in 2010, according to a government website.
“There will be only a small chance of growth, but also not a lot of danger,” said Michael Inauen, an analyst at Zuercher Kantonalbank. “Swisscom is already doing business in Liechtenstein and the country is very small. It is a rather neutral step.”
Swisscom shares were unchanged at 381.70 francs as of 9:37 a.m. in Zurich trading. The company has a market value of 19.8 billion francs ($21 billion).
Liechtenstein Telecom had a loss of 1.8 million francs and sales of 54.1 million francs in 2011. The company has about 18,600 customers.
The price will probably be in the “low double-digit million Swiss francs range,” Carsten Roetz, a spokesman for Swisscom, said by phone. “The deal won’t have any impact on Swisscom’s results in 2012.”
Liechtenstein’s Parliament will make legal arrangements for the purchase “towards the end of the year,” Swisscom said.
Swisscom, which holds a license for mobile services in Liechtenstein, said it’s planning to take over the telecommunications business and infrastructure that belongs to Liechtenstein’s power company.
Telecom Liechtenstein’s cable business and Swiss unit Deep AG won’t be included in the purchase.
Swisscom said it had offered fixed-network phone service in Liechtenstein and sold that business to the country in 2003.