Press Releases

Budapest, June 16, 2006 13:00

On June 16, 2006 Magyar Telekom signed an agreement on purchasing 100% ownership share of KFKI-LNX Zrt. for a maximum price of 9.67 billion HUF. The KFKI Group - KFKI-LNX and its two subsidiaries ICON and IQSYS - is operating in the Hungarian IT services market. As a result of the acquisition the Magyar Telekom Group may achieve further growth and service portfolio expansion in the business segment of the IT services market.

There is a steadily growing demand from business customers for IT services. The KFKI Group provides an organic growth opportunity for Magyar Telekom in the IT services market, so the acquisition fits into the strategy of the Magyar Telekom Group and strengthens its existing positions.

In line with the medium-term strategic targets published in 2004 Magyar Telekom creates additional value with the acquisition of the KFKI Group through expanding the customer base and the service portfolio. Magyar Telekom and the KFKI Group are present in complementary segments of the market with their business services. This makes it possible for them to develop integrated, customized product offerings adjusted to the newly evolving demands of the business services market.

In terms of both revenue and profits, the KFKI Group is a stable market player with reliable business operations and experienced professionals. In 2005 the Group's revenue reached 17 billion HUF. Three companies belong to the KFKI Group which together employ close to 400 people:
- KFKI-LNX - building and operating communication networks (network integration)
- ICON - IT infrastructure and security solutions (systems integration)
- IQSYS - software and application development

The maximum purchase price of 9.67 billion HUF spent on the acquisition of KFKI-LNX Zrt. also comprises a "moving price element" which depends on the future financial performance of the Group. Magyar Telekom is financing the acquisition with its available credit lines. Financial closing of the transaction, which is expected by the second half of 2006, is subject to the approval of the regulatory authority (Hungarian Competition Authority).