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Telenor rejects immediate merger talks, notes interest in Sonofon buyout

HELSINKI, Finland-Telenor, the Oslo-based semi-state-owned telecom operator, rejected on 17 July speculation by market analysts that the company is anxious to re-open consolidation talks with the newly merged Telia-Sonera.

Jon Fredrik Baksaas, Telenor’s chief executive officer (CEO), said Telenor’s immediate objective is to consolidate its position as a leading pan-Nordic player in the fields of third-generation (3G) mobile and fixed-line telecom services.

“We are not interested in participating in a giant Nordic merger at this time. We do not want to be a new WorldCom. There would be many risks attached to a large-scale merger with Telia and Sonera. We are more concerned with raising Telenor’s European profile,” he said.

To this end, the Telenor CEO plans to lead a pan-European road show targeting financial institutions and fund managers. “We need to sell Telenor in a more aggressive way and rekindle investor interest in Telenor’s shares,” said Baksaas.

While Telenor is downplaying its immediate interest in joining a larger Nordic telecom merger, the company remains committed to the primary goal of growing its business through acquisitions. Of primary interest is the Danish mobile operator Sonofon, in which Telenor owns a 53.5-percent stake. Telenor wants to buy partner BellSouth’s 46.5-percent holding in Sonofon.

“BellSouth has indicated it wants to sell out of Sonofon, and Telenor is clearly interested in securing total ownership, and if not total then as close to total as possible. Right now no agreement has been reached on price,” said Baksaas.

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