– With c. 13.2 million customers, debitel Group is the leading MSP in Germany and the third largest overall mobile provider
– Together with its affiliated companies debitel Group has developed a Germany-wide distribution network with more than 6,000 points of sale as well as over 500 of its own shops
– debitel Group is controlled by Permira managed funds
– With c. 11.7 million customers, freenet AG is one of Germany’s leading telecommunications groups offering customers internet access (broadband & narrowband), fixed and mobile telephony, web hosting and portal services
– freenet’s mobilcom subsidiary is the #2 MSP in Germany with 5.7m subscribers and a broad offering of prepaid, postpaid and no frills mobile phone packages
– freenet AG employs c. 3,800 staff
– The transaction marks a significant step in the long awaited consolidation of the German telecoms market and gives freenet a leading market position from which to participate further
– The acquisition creates a German telecoms market leader with c. €5bn revenues, an adjusted EBITDA of c. €350m, and an extensive customer base of c. 19m subscribers
– The transaction positions freenet as the # 3 mobile player in the German market
– With c. 1,015 shops post transaction, freenet becomes one the largest network-independent distributors of telecoms products in Germany, able to sell multiple brands
– Substantial synergies are expected to be achieved from the integration of debitel and mobilcom, leading to significant EPS accretion
– Arma Partners has a longstanding relationship with freenet AG and has previously advised freenet on their acquisition of Tiscali’s broadband and narrowband customers in Germany
– Arma Partners acted as lead advisor in the M&A portion of this transaction, driving the negotiation process, due diligence and the positioning of the equity story
– Arma Partners helped to prepare the press release, the equity analyst presentation, and the investor Q&A, which were key considering the complex freenet shareholder structure
– Arma Partners was also appointed by the supervisory board of freenet AG to provide an independent fairness opinion on its acquisition of debitel Group