Mid Europa and France Telecom-Orange sell Orange Austria for €1.3bn

The valuation of €1.3bn includes debt of around €1bn, leaving approximately €300m in returns for Mid Europa and France Telecom-Orange. Mid Europa will also receive an earnout payment of €70m in the two years following the transaction. 

According to Mid Europa, the returns from the exit are approximately on par with the initial investment.

unquote" reported that Mid Europa, which currently holds a 65%-stake in Orange Austria, was looking to exit the company in May 2011. It was expected to sell its share to partner shareholder France Telecom-Orange. France Telecom-Orange currently owns 35% of the company and pre-emption rights until 2013.

The deal is part of France Telecom-Orange's effort to streamline its business across Europe.

After the acquisition the company will be wholly owned by Hutchison 3G Austria, which is a subsidiary of Hong Kong telecommunications business Hutchison Whampoa Ltd.

Hutichsen 3G Austria is looking to sell frequencies, base station sites, intellectual property rights and the operator Yesss! Telekommunikation GmbH to Telekom Austria Group.

The transaction is still subject to approval by regulatory and anti-trust authorities and is expected to be concluded in mid 2012.

Previous funding
Mid Europa first invested in Orange Austria in July 2007, buying the business for €1.4bn from E.ON, TDC and Telenor.

Company
Orange Austria is a mobile operator with an approximate market share in terms of customers of 20% in Austria.

People
Thierry Baudon, managing partner, led the exit on behalf of Mid Europa Partners. Michael Krammer is chief executive of Orange Austria.

Advisers
Vendor – Morgan Stanley (Corporate finance).
Equity – J.P.Morgan (Corporate finance). 

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