Brennercom shareholder buyout

Retelit boosts market share with Brennercom buy

18 February 2020 | Company Announcement

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Retelit subsidiary confirms acquisition of Brennercom S.p.A. through shareholder buyout

Retelit subsidiary Retelit Digital Services S.p.A., has signed a contract to acquire Brennercom S.p.A. through a shareholder buyout.

The deal was approved last month when Brennercom’s parent company Athesia Group confirmed it had accepted a bidding offer of €52 million, based on the enterprise value of Brennercom and its subsidiaries, excluding MET.

The transaction is now scheduled to close in July, subject to Retelit acquiring sufficient lines of credit with leading banks. Up to €15 million of the price may be paid in listed Retelit shares.

Posting revenues of €32.4 million in 2018, Brennercom is a key stakeholder in the Munich-Tyrol-Milan axis, while Retelit is a leading force in Italy’s fibre optic infrastructure development.

This deal means Retelit can build on its existing volumes and margins to build its presence in key markets and areas across Italy. It has also stated intentions to invest in technology and expand infrastructure and services, as well as extended commercial coverage across the country, while improving economies of scale and direct cost optimisation.

A statement from the firm read: “The integration of the two companies is expected to bring about a significant improvement in terms of volumes and margins, and in particular, synergies are expected to result in a 35% increase in Brennercom's EBITDA, once fully operational.

“For 55% they will stem from increased revenues thanks to cross-selling opportunities on the respective customers and the expansion of the Brennercom business area and 45% from efficiencies related to the use of Retelit infrastructure by Brennercom and through economies of scale.”