BUCHAREST (Romania), December 27 (SeeNews) – Romanian internet service and infrastructure provider Direct One said that the country's anti-trust body approved its takeover of Bucharest's underground fiber optic network operator Netcity Telecom.
At the beginning of September, Direct One said it will acquire Netcity Telecom, part of Romanian group UTI, for an undisclosed sum.
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"We welcome the decision of the Competition Council on this transaction, based on the complementarity of the two networks - Netcity and Direct One. We will continue the process of acquisition of Netcity as we committed to shareholders and to financing banks," Direct One board chairman Marian Pantazescu said in a press release.
Direct One is part of Electrogrup, which is controlled by Romanian investors Simion and Teofil Muresan. The group also includes natural gas and electricity producer, provider and distributor Nova Power &Gaz, wind power company WESEE and micro hydro power plant company Alesis și GV Energy.
In 2015, Direct One posted a net profit of 12.7 million lei ($3 million/ 2.6 million euro), up 56% from the previous year, and a turnover of 42.4 million lei, down by 12% on the year, data posted on the finance ministry's website showed.
Direct One operates a network of fiber length of over 5,500 kilometers in Romania.
The Bucharest city hall granted the fiber-optic network concession to Romanian UTI Systems in June 2008 and Netcity Telecom was picked as the network deployer.
The length of the fiber-optic network is 7,000 kilometres, whilst the length of the underground ducting reaches 880 kilometres.
The initial investment in the network was 300 million euro, financed fully by UTI. It is expected to repay by fee income generated during the 49 years of the contract.
In October, UTI announced that it intends to sell Netcity and has since been in negotiations with different potential buyers.
In May, Romania's anti-trust body launched an investigation regarding a possible dominant and abusing position of Netcity on the market, which would have led to discrimination among the different internet service providers that wanted to use the network.
Netcity's net profit was 32% higher in 2015, to 14.5 million lei, while its turnover edged down to 40.3 million lei, finance ministry data showed.
(1 euro = 4.5363 Romanian lei)