TeliaSonera and Telenor to combine their operations in Denmark


TeliaSonera and Telenor have entered into an agreement to merge their Danish
operations into a new joint venture where the parties will own 50 percent each.
The new joint venture will create a robust mobile operator who is able to
increase investments in networks to the benefit of our customers.
“We are making a necessary and natural move by forming a joint venture with
Telenor building on the network partnership we already have with them. By
joining forces we can secure investments in Denmark, to the benefit not only of
our customers but to the Danish society as a whole,” says Robert Andersson, EVP
and Head of Region Europe in TeliaSonera.
The new company will have a combined number of mobile subscriptions of around
3.5 million. With a combined mobile subscriber market share of approximately 40
percent, revenues of more than DKK 9 billion and a significant synergy
potential, the transaction creates a robust operator.
The need for consolidation in the Danish telecom market has been apparent for a
while as operators face continued pressure on revenues and profitability,
limiting the room for investments and innovation. Telenor and TeliaSonera have
since 2012 cooperated in Denmark through their joint mobile network. The parties
now agreed that an independent joint venture is the strategically preferred
route to capture synergies and to create value.
“Competition in Denmark is intense and we face continued pressure on revenue
growth and profitability, making consolidation inevitable. By combining the
assets and customer bases of Telenor and TeliaSonera in Denmark, the joint
venture will become a robust operator. We will be able to offer our customers a
high-quality network with outstanding connectivity and the best customer
experience in Denmark,” says Kjell Morten Johnsen, EVP and Head of Telenor
Region Europe.
Efficiency gains
The merger of the two operations aims for annual efficiency gains of at least
DKK 800 million, with full effect from 2019. The largest areas of synergies are
envisaged for distribution, sales and marketing and call centers, administrative
costs, network and IT. Integration costs are expected to total DKK 800 million
during 2015-2017.
Benefits for customers
The combination of TeliaSonera and Telenor, two companies willing to invest and
considered as technology leaders in telecommunications, will also bring
substantial benefits to customers in Denmark. It will provide a larger
distribution network as well as the best network connectivity in terms of
coverage and performance. In addition, the merger will put the joint venture
into a better position to invest in attractive and user-friendly services.
Combining the fixed networks and services of the two companies will create an
even better broadband provider for Danish consumers and businesses.
Governance structure
The Board of the new joint venture company will have a balanced representation
from Telenor and TeliaSonera. The board will have seven members, of which each
party shall appoint three. The Chair of the Board shall be appointed unanimously
by the parties.
The recruitment process to find a CEO for this joint venture will commence and
the two companies are confident in finding the right candidate for this job in
due course.
Valuation
Telenor and TeliaSonera have agreed that the enterprise values of their
respective operations are fairly equal and hence the agreement is based on equal
ownership. Differences in net debt and changes in working capital from signing
to closing will be settled in cash.
Timeline
Telenor and TeliaSonera have agreed upon the key transaction terms. The
transaction requires approval from the EU Commission. The parties expect EU
clearance and closing of the transaction during 2015. The operations remain
separate and operate independently up to the closing of the transaction.
Analyst and media telephone conference at 09.00 am CET
TeliaSonera and Telenor invite you to a conference call with TeliaSonera’s CFO
Christian Luiga and Telenor’s CFO Richard Olav Aa.
Dial-in number: +44 (0) 2071 928000
Access code: 44826589
You can also listen to the conference call afterwards until December 8, 2014.
Replay number:  +44 (0) 1452 55 00 00
Access code: 44826589
Press conference in Denmark at 11.30 am CET
TeliaSonera and Telenor invites you to a press conference with Robert Andersson,
EVP and Head of Region Europe in TeliaSonera, and Kjell Morten Johnsen, EVP and
Head of Telenor Region Europe.
Place: Radisson Blu, Amager Boulevard 70, Copenhagen
TeliaSonera AB discloses the information provided herein pursuant to the Swedish
Securities Markets Act and/or the Swedish Financial Instrument Trading Act. The
information was submitted for publication at 08.00 a.m. CET on December 3, 2014.
For more information, please contact the TeliaSonera press office 46 771 77 58
30, press@teliasonera.com or visit TeliaSonera
Newsroom (http://www.teliasonera.com/en/newsroom). Also follow us on Twitter
@TLSN_Media (https://twitter.com/TLSN_Media).

Forward-Looking Statements
Statements made in the press release relating to future status or circumstances,
including future performance and other trend projections are forward-looking
statements. By their nature, forward-looking statements involve risk and
uncertainty because they relate to events and depend on circumstances that will
occur in the future. There can be no assurance that actual results will not
differ materially from those expressed or implied by these forward-looking
statements due to many factors, many of which are outside the control of
TeliaSonera.
TeliaSonera provides network access and telecommunication services in the Nordic
and Baltic countries, the emerging markets of Eurasia, including Russia and
Turkey, and in Spain. TeliaSonera helps people and companies communicate in an
easy, efficient and environmentally friendly way. Our ambition is to be number
one or two in all our markets, providing the best customer experience, high
quality networks and cost efficient operations. TeliaSonera is also the leading
European wholesale provider who owns and operates one of the world's most
extensive fiber backbones. In 2013, net sales amounted to SEK 101.7 billion,
EBITDA to SEK 35.6 billion and earnings per share to SEK 3.46. The TeliaSonera
share is listed on NASDAQ Stockholm and NASDAQ Helsinki. Read more at
www.teliasonera.com.                 (http://www.teliasonera.com/)

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