Polkomtel Sale: Caveat Emptor! Plus is A Big Minus


“Plus” Polkomtel, a privately held Polish telco is still in the process of being sold. The rather long-drawn out sales process presumably reflects relative buyer apathy for a company which has appeared at best dysfunctional to some clients.

Bidders may wish to consider their options. After all the only telco holding stock currently is itself a global market leader and apparently happy to sell out of Polkomtel despite the many underlying attractions to investing in Poland’s growing economy.


Mobile telecoms companies all harbor more or less ubiquitous marketing strategies consisting of big name stars and amusing or glamorous advertisements. Plus Polkomtel also markets with star names although customers might be inclined to believe that any correlation with a serious mobile telephony company is thereafter, modest, to put it mildly.

Plus appears to provide little, if any, concept of organized customer care. Customers report no clear line of responsibility or management for issues and little evidence the company actually cares about its clients other than to demand payment for services that are arguably mis-sold.

In recent days there had been media stories the sale process might be delayed due to a lack of satisfactory bids while apparently as many as four bidders may still be in the process, namely:

Polish billionaire Zygmunt Solorz-Zak, Apax Partners LLP, TeliaSonera AB and a group formed by Telenor ASA and Bain Capital LLC.

Some reports suggest only Solorz-Zak and Telia Sonera are still in the official bidding with an auction now being scheduled.

Either way, the bidders failing to get this business may ultimately have time to reflect more on avoiding a clunker of an investment than missing a business with upside. On the other hand, at a suitably distressed sale price, Plus Polkomtel may be a good investment for somebody with the time and energy to develop a coherent customer-centric management focus which can deliver.

The shareholders of Polkomtel are mostly major Polish industrial businesses businesses: KGHM (copper), PKN Orlen (oil), PGE (power) and coal miner Weglokoks.

Interestingly, the other shareholder is the leading international telco Vodafone. The fact that Vodafone (the only shareholder which actually answers complaints about Polkomtel incidentally) are seeking to sell is perhaps not the best indication that this is a dynamic growth oriented company. After all, the Polish consumer space is a bright and fast growing marketplace – why are Vodafone happy to sell their stake in a mobile provider? Having seen Polkomtel up close, it is always a cause for concern when the most knowledgeable shareholder about the business is also happy to sell.

The next round of bidding is apparently expected by June 10th. Prospective purchasers would be wise to concentrate on extensive due diligence in the meantime.

Plus Polkomtel is a huge case of caveat emptor.

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