* Turk Telecom, Turkcell, Telenor, D.Telekom check books
* Binding bids expected by March 18
By Tsvetelia Tsolova
SOFIA, Feb 1 Four major telecoms companies are
competing to buy Bulgarian mobile operator Globul in a deal
expected to be worth about 700 million euros ($950 million), a
source with direct knowledge of the process said on Friday.
Globul is controlled by OTE, Greece's biggest
telecoms operator, which plans to sell its Bulgarian unit as
well as satellite unit HellasSat to help refinance 1.8 billion
euros of debt by early 2014.
Turk Telekom, mobile phone operator Turkcell
and Norway's Telenor are carrying out due
diligence on Globul, Bulgaria's second-biggest mobile operator,
the source, who wished not to be named, told Reuters.
Deutsche Telekom, which has a 40 percent stake in
OTE, was also eyeing the Bulgarian unit, put on sale along with
electronic appliance retailer Germanos. But it will only get
involved if the bids came below expectations, the source said.
"Deutsche Telekom is in the process rather to encourage the
other players to make serious offers," the source said.
Both Globul and OTE declined to comment.
The source said binding bids are expected by March 18 and a
deal can be expected later in March or in April.
A second source familiar with the matter, however, said OTE
may also decide to cancel the sale after it secured 700 million
euros through a bond issue on Wednesday.
The issue covered a large part of OTE's debt repayment
obligations for this year, easing its liquidity strains to the
extent the company may cope with its debt even without having to
sell Globul, the second source said.
OTE might want to keep Globul, which is one of its most
efficient and profitable units, the second source said, but
added it will continue with the procedure and make a final
decision based on the bids.
"For the moment, it looks like the things are moving towards
a deal rather than not," the first source said.
Globul accounts for about 7 percent of OTE's sales and about
9 percent of earnings before interest, tax, depreciation and
amortisation (EBITDA). Globul's EBITDA margin for 2011 was about
38 percent, higher than 34 percent for the entire group.
But OTE's chief executive said late last year Globul
required a lot of investments, which OTE might not be able to
provide, to remain competitive in a cut-throat Bulgarian market
where customers are increasingly switching to cheaper services
such as pre-paid offers.
In Bulgaria, Globul competes with Telekom Austria
Mobiltel and Vivacom, recently acquired by a Bulgarian banker
and Russia's VTB Bank.
OTE might raise up about 200 million euros by selling its
satellite venture, analysts say.
($1 = 0.7370 euros)
(Additional reporting by Harry Papachristou in Athens; Editing
by Sam Cage and Mark Potter)