Cosmote-Zapp transaction: Telemobil did not have even 1m euros left in its accounts

Consultants and lawyers collected fees of over 1.5 million euros and the Greek paid 67.5 million euros for the company, according to a report of Greek group OTE.

Telemobil (Zapp), the local mobile communications group acquired last year by the Cosmote group, had at the time of the transaction (June 2009) almost 150 million euros in overall debt and less than 1 million euros in cash in its accounts, according to data published in a report of Greek telecommunications group OTE.

The company held by Saudi Oger group, the first operator of mobile communications in Romania, was on a decline at the time of the acquisition: its client base had fallen to 374,000 from a peak of 500,000 in 2007 and revenues were also on a downward trend. According to data in the OTE and Deutsche Telekom reports, Zapp had recorded only 3.2 million euros in revenues in the first quarter of 2009. In 2008 Telemobil recorded 61 million euros in revenues and 41 million euros in losses, compared with a 90 million-euro business and 9 million euros in losses in 2007.

According to data in the OTE report, Telemobil had 18 million euros in current liabilities and 131.8 million euros in other liabilities - generated mainly by the loan contracted by the company from China Development Bank in 2008 to build its 3G network.