Try the new FT.com

Last updated: July 30, 2007 9:47 pm

KPN unveils €766m Getronics bid

  • Share
  • Print
  • Clip
  • Gift Article
  • Comments

Getronics, the Dutch IT group, on Monday unveiled a €766m ($1bn) cash offer from KPN, the Netherlands’ largest telecommunications group.

Shares in Getronics opened almost 20 per cent up at €6.11 and closed at €6.25, after KPN said it intended to pay €6.25 a share and would also make offers for Getronics’ unsubordinated convertible bonds and preference shares.

The deal, which has the support of Getronics’ management and supervisory boards, will be funded from existing financial resources, KPN said. Separately, KPN announced flat second-quarter earnings before interest, tax, depreciation and amortisation of €1.28bn.

Dresdner Kleinwort said: "Although Getronics looks a touch expensive, it makes sense for KPN as it is a restructuring and integration candidate, which this management has a sound track record on."

Talks between the parties broke down last year because KPN was interested in only part of Getronics’ operations. In March, Getronics shares rose on media reports that talks were back on, despite KPN denials.

This month Getronics announced an unnamed US buyer was interested in the company, but those talks too came to nothing. Klaas Wagenaar, Getronics’ chief executive, declined to comment on those discussions.

Ad Scheepbouwer, KPN chief executive, said Getronics had sold non-core assets since it held initial exploratory talks with KPN.Mr Scheepbouwer noted "huge cross selling opportunities" from the creation of a "one-stop shop" for the supply of IT and telecoms services to business customers. KPN and Getronics are already partners serving customers including ING, the Dutch financial institution, and NS, the Dutch Railway.

KPN will fold into Getronics its ICT business, with 3,500 staff, focusing on Getronics’ core Dutch, Belgian, UK and US operations and selling non-core activities. “A few hundred jobs”, from a combined total of 30,000 in the Netherlands, would go to help achieve synergies of at least €50m a year from 2009.

The deal marks the end of the troubled tenure of Mr Wagenaar. He will step down as KPN instals a new management team and supervisory board at Getronics.

Appointed in 2003, Mr Wagenaar faced intense investor pressure after falling profits, management upheaval and restructuring.

Getronics is still under investigation by the Dutch securities regulator about whether it informed the market quickly enough about heavy losses in Italy. KPN said it had been briefed on the status of that inquiry.

Defending his performance Mr Wagenaar said that when he arrived the company was “close to dying, with huge debts, and no one was prepared to do anything”.

“I can look staff, customers and shareholders in the eye without any embarrassment. It is a job well done,” he added.

ING advised KPN. ABN Amro advised Getronics. Rabo Securities advised Getronics’ supervisory board.

Copyright The Financial Times Limited 2017. You may share using our article tools.
Please don't cut articles from FT.com and redistribute by email or post to the web.

  • Share
  • Print
  • Clip
  • Gift Article
  • Comments

EMAIL BRIEFING

Sign up to #techFT, the FT's daily briefing on tech, media and telecoms.

Sign up now

NEWS BY EMAIL

Sign up for email briefings to stay up to date on topics you are interested in

SHARE THIS QUOTE