Partner Communications Announces Entering into an Agreement for the Acquisition of 012 Smile
October 13 2010 - 1:41PM
Business Wire
Partner Communications Company Ltd. ("Partner" or "the
Company") (Nasdaq:PTNR)(TASE:PTNR), a leading Israeli
communications operator, announces that it has entered today
into a share purchase agreement with Merhav-Ampal Energy Ltd. (the
"Seller") and 012 Smile Telecom Ltd., an Israeli private
company, wholly-owned by the Seller ("012 Smile"), according
to which the Company shall acquire all of the outstanding shares of
012 Smile and shall assume certain loans from the Seller to 012
Smile for a purchase price of 650 million New Israeli Shekels
("NIS") (approximately $180 million) (the
"Agreement"). As part of the Agreement, Partner has also
agreed to guarantee long term bank loans of 012 Smile of
approximately NIS 800 million (approximately $222
million).
The Agreement includes an assignment by 012 Smile to the Seller
of the right to receive payments due from a third party in the
amount of NIS 42 million (approximately $11.6 million).
012 Smile is an Israeli operator of international
telecommunication services and local telecommunication fixed
services (including telephony services using VoB access) and is a
provider of internet services.
The transaction, which was approved today by the Company's Board
of Directors, is expected to be completed (closing date) within two
to three months and is subject to customary closing conditions,
including the regulatory approvals of the Israeli Ministry of
Communications and the Israeli Antitrust Commissioner.
Commenting on the transaction, Mr. Yacov Gelbard, CEO of
Partner, said: "The purchase of 012 Smile is another important step
in Partner’s strategic transformation into a comprehensive
communications group allowing Partner to focus on its core cellular
business while 012 Smile will continue to focus on its current core
businesses. 012 Smile's operational and financial performances have
demonstrated impressive improvements. We are convinced that this
transaction will increase competition in the market for the benefit
of the consumers, in accordance with the Ministry of
Communications' vision to create a number of strong competing
telecommunications groups.“
Mr. Gelbard added that "As a result of the purchase, Partner’s
mid-term consolidated EBITDA is expected to increase annually by
approximately NIS 350 million.”
Important additional information regarding the Agreement will
be filed with the SEC under Form 8-K in the next few days.
Forward-Looking
Statements
This press release includes forward-looking statements within
the meaning of Section 27A of the US Securities Act of 1933, as
amended, Section 21E of the US Securities Exchange Act of 1934, as
amended, and the safe harbor provisions of the US Private
Securities Litigation Reform Act of 1995. Words such as "believe",
"anticipate", "expect", "intend", "seek", "will", "plan", "could",
"may", "project", "goal", "target" and similar expressions often
identify forward-looking statements but are not the only way we
identify these statements. All statements other than statements of
historical fact included in this press release regarding our future
performance, plans to increase revenues or margins or preserve or
expand market share in existing or new markets, reduce expenses and
any statements regarding other future events or our future
prospects, are forward-looking statements.
We have based these forward-looking statements on our current
knowledge and our present beliefs and expectations regarding
possible future events. These forward-looking statements are
subject to risks, uncertainties and assumptions about Partner,
consumer habits and preferences in cellular telephone usage, trends
in the Israeli telecommunications industry in general, the impact
of current global economic conditions and possible regulatory and
legal developments. For a description of some of the risks we face,
see "Item 3D. Key Information - Risk Factors", "Item 4. -
Information on the Company", "Item 5. - Operating and Financial
Review and Prospects", "Item 8A. - Consolidated Financial
Statements and Other Financial Information - Legal and
Administrative Proceedings" and "Item 11. - Quantitative and
Qualitative Disclosures about Market Risk" in the Company's 2009
Annual Report (20-F) filed with the SEC. In light of these risks,
uncertainties and assumptions, the forward-looking events discussed
in this press release might not occur, and actual results may
differ materially from the results anticipated. We undertake no
obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise.
The convenience translations of the Nominal New Israeli Shekel
(NIS) figures into US Dollars were made at the rate of exchange
prevailing at October 12, 2010: US $1.00 equals NIS 3.620. The
translations were made purely for the convenience of the
reader.
Use of Non-GAAP Financial
Measure:
Earnings before financial interest, taxes, depreciation,
amortization and exceptional items ('EBITDA') is presented because
it is a measure commonly used in the telecommunications industry
and is presented solely to enhance the understanding of our
operating results. This measure, however, should not be considered
as an alternative to operating income or income for the year as
indicators of our operating performance. Similarly, this measure
should not be considered as an alternative to cash flow from
operating activities as a measure of liquidity. EBITDA is not a
measure of financial performance under generally accepted
accounting principles and may not be comparable to other similarly
titled measures for other companies. EBITDA may not be indicative
of our historic operating results nor is it meant to be predictive
of potential future results.
About Partner
Communications
Partner Communications Company Ltd. ("Partner") is a leading
Israeli provider of telecommunications services (cellular,
fixed-line telephony and internet services) under the orange™
brand. The Company provides mobile communications services to over
3 million subscribers in Israel. Partner’s ADSs are quoted on the
NASDAQ Global Select Market™ and its shares are traded on the Tel
Aviv Stock Exchange (NASDAQ and TASE: PTNR).
Partner is an approximately 45%-owned subsidiary of Scailex
Corporation Ltd. ("Scailex"). Scailex's shares are traded on the
Tel Aviv Stock Exchange under the symbol SCIX and are quoted on
"Pink Quote" under the symbol SCIXF.PK. Scailex currently operates
in two major domains of activity in addition to its holding in
Partner: (1) the sole import, distribution and maintenance of
Samsung mobile handset and accessories products primarily to the
major cellular operators in Israel (2) management of its financial
assets.
For more information about Scailex, see
http://www.scailex.com.
For more information about Partner, see
http://www.orange.co.il/investor_site.
About Ampal
Ampal and its subsidiaries acquire interests primarily in
businesses located in the State of Israel or that are
Israel-related. Ampal seeks opportunistic situations in a variety
of industries, with a focus on energy, chemicals, communications
and related sectors. Ampal’s goal is to develop or acquire majority
interests in businesses that are profitable and generate
significant free cash flow that Ampal can control. For more
information about Ampal please visit the web site at
www.ampal.com.
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