TIW to Increase its Ownership of MobiFon S.A. and CESKY Mobil A.S.
Telesystem International Wireless Inc. ("TIW") is
pleased to announce that it has entered into an agreement to acquire
5.9% of MobiFon S.A. ("MobiFon") from Emerging Markets Partnership
(Europe) Limited, an affiliate of Emerging Markets Partnership
("EMP"), in exchange for the issuance of 12,971,119 common shares of
TIW representing an equity interest of approximately 11.0% in TIW. The
number of TIW shares to be issued in exchange for the MobiFon shares
has been established on an economic equivalency basis. Upon the
closing of the transaction as agreed, TIW will increase its equity
interest in MobiFon from 50.1% to 55.9%.
The transaction is subject to other MobiFon shareholders' pro rata
rights of first refusal which, if exercised, will reduce the actual
number of shares to be acquired by TIW. At a minimum, TIW will acquire
a 3.6% interest in MobiFon in exchange for 7,947,820 common shares of
TIW.
Emerging Markets Partnership, a global private equity firm,
manages investment funds with almost US$ 6 billion in assets. Its
interest in MobiFon was funded from its US$ 550 million AIG Emerging
Europe Infrastructure Fund. EMP also indirectly holds a 14.0% interest
in TIW Czech N.V. ("TIW Czech"), the holding company through which TIW
owns Cesky Mobil a.s., its operating subsidiary in the Czech Republic.
As part of the transaction, EMP will rebalance its holdings in TIW
Czech by agreeing to sell to TIW some of its shares in TIW Czech in
order that EMP's direct and indirect equity ownership in TIW Czech
will not change. The number of TIW Czech shares that TIW will acquire
depends on the extent to which other MobiFon and TIW Czech
shareholders exercise their respective rights of first refusal. If
none of those rights of first refusal are exercised, TIW will acquire
from EMP a 2.9% equity interest in TIW Czech for a cash consideration
that EMP has agreed to reinvest into 1,650,595 additional TIW common
shares. This represents an additional equity interest of approximately
1.2% in TIW, thereby bringing EMP's aggregate equity interest in TIW
to approximately 12.2%. TIW would therefore increase its equity
interest in TIW Czech from 21.0% to 23.9% upon the closing of the
transaction.
"We are please to have EMP become one of our major shareholders.
This is also an important milestone in the continuing simplification
process of TIW's corporate structure, pursuant to which we continue to
seek opportunities to increase our economic interest in our
subsidiaries", said Bruno Ducharme, President and Chief Executive
Officer of TIW. "EMP is delighted to become a core shareholder of TIW
and looks forward to continuing its fruitful long-term relationship
with it", said Thierry Baudon, Chief Executive Officer of Emerging
Markets Partnership (Europe) Limited.
The terms of the agreement restrict EMP's ability to resell its
TIW shares for a period of six months following closing of the
transaction. The transaction is subject to EMP becoming a party to the
existing investor rights agreement among affiliates of Telesystem
Limited, J.P. Morgan Partners, LLC and Hutchison Whampoa Limited. TIW
also expects a representative of EMP to join its board of directors
shortly after completion of the transaction.
The closing of the transaction remains subject to certain
conditions including the execution of final documentation and
regulatory approval and is expected to take place toward the end of
the first quarter of 2004. After closing, ClearWave N.V., an 86.8%
owned subsidiary of TIW and MobiFon Holdings B.V. a wholly-owned
subsidiary of ClearWave N.V., will become the respective record
holders of the TIW Czech and MobiFon shares to be acquired in this
transaction.
Forward-looking Statements
This news release may contain certain forward-looking statements
that reflect the current views and/or expectations of TIW with respect
to its performance, business and future events. Such statements are
subject to a number of risks, uncertainties and assumptions. Actual
results and events may vary significantly.
About TIW
TIW is a leading cellular operator in Central and Eastern Europe
with more than 5.0 million managed subscribers. TIW is the market
leader in Romania through MobiFon and is active in the Czech Republic
through Cesky Mobil a.s. TIW's shares are listed on the Toronto Stock
Exchange ("TIW") and NASDAQ ("TIWI"). |
