Tiscali 2001 Annual Report Download - page 45

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37
Report on Operating Performance
CD Telekomunikace sro
The Czech Company CD Telekomunikace sro holds a government licence to offer
telecommunications services in the Czech Republic, and represents a strategic acquisition
within the framework of Tiscali's expansion into eastern and central Europe. The Company
has been awarded exclusive rights by Czech railways to lay and manage a fibre optic
network along the country's entire rail network — a total length of about 9,600 kilometres.
In July 2000, Tiscali acquired 80% of CD Telekomunikace's floating capital. The remaining
20% was purchased in July 2001. In both cases, consideration was paid through newly
issued Tiscali shares.
Excite Italia BV
In February 2001 Tiscali signed a strategic partnership agreement with Excite@Home.
Under the terms of the agreement, Tiscali purchased 70% of Excite Italia BV, a Dutch
Company with operational headquarters in Italy. The total investment, for Tiscali, was EUR
27mn in cash, of which EUR 23.4mn were related to an underwriting of a capital increase
by Excite Italia. In March 2002, Tiscali signed an agreement for the purchase of the
remaining 30% of Excite Italia BV, held by the US-based At Home Corporation. At Home will
also give Tiscali all the rights to the Excite brand, technology and domains for the whole of
Europe.
The price of the transaction is EUR 2,985,000, to be paid in newly issued Tiscali shares.
The agreement is subject to approval of the capital increase by Tiscali's Shareholders'
Meeting, set for April 29 and 30, 2002. Upon completion of the transaction (expected by
mid-May 2002), Tiscali will own 100% of Excite Italia BV's share capital. Excite Italia was
established in 1999 and is one of Italy's biggest portals, with more than 2mn registered
users as of December 2001. Excite Italia has kept its operational and managerial
autonomy, acting at the same time as a distribution channel for Tiscali's innovative on-line
services, including access, Voice Over IP and voice navigation services.
Guglielmo GmbH (Planet Interkom)
In April 2001, Tiscali took over the German Company Guglielmo GmbH, owner of the ISP
Planet-Interkom, from VIAG Interkom GmbH & Co., a German Company belonging to the
British Telecom Group. Payment consisted of 4,141,758 new Tiscali shares plus EUR 15mn
in cash, for a total consideration of EUR 77.1mn. Planet Interkom is a leading German ISP,
providing Internet access to residential customers. With approximately 685,000 active
users, who generate around 300mn minutes of traffic per month. Planet Interkom was
recently rated one of the top dial-up providers by the German specialist press (Chip, PC
Online, Tomorrow, PC Magazin).
SurfEU.com Ltd
In April 2001, Tiscali acquired SurfEU.com Ltd, an ISP and portal with a leading position in
Germany and operations in Austria, Switzerland and Finland. At March 31, 2001, the
Company had more than 1.1mn registered subscribers, of whom over 600,000 were active.
The deal also included an agreement between Tiscali and the Media Saturn Group, a
former SurfEU shareholder, for the distribution of Tiscali products and services in Germany,
Austria and Switzerland. Following the takeover, all SurfEU services were renamed under
the brand Tiscali.