Telia Snags Unisource Iberia to Boost IP Push

Telia AB today announced an agreement to buy Unisource Iberia, in a move aimed at expanding the Swedish telecommunications carrier's international IP (Internet protocol) network infrastructure.

The purchase will further boost Telia's ability to offer IP-based services to corporate customers throughout Europe, said Olle Waktel, Telia's business manager for IP services.

Financial details about the deal were not disclosed.

Unisource Iberia, with operations in both Spain and Portugal, was the second Unisource unit to find a home after the European telecom alliance -- owned by Telia, Koninklijke KPN NV of the Netherlands and Swisscom AG -- last month announced a plan to divest all of its operations.

Telia, meanwhile, is currently awaiting European Union approval for its planned merger with Norway's Telenor AS. [See "UPDATE: EU Cautious over Telia-Telenor Merger," Sept. 27.]For Telia, Unisource Iberia was a perfect fit, since Spain is a rapidly growing market that also functions as an entry point to other Spanish language markets, including South America, said Waktel.

Telia has no specific plans for acquiring any other Unisource units, although Waktel would not exclude future purchases. The company will continue to keep an eye out for suitable acquisition prospects in the IP arena, "primarily in Europe," said Waktel.

Although Telia today faces limited competition for its Europe-wide IP services, with only a few of the continent's national operators offering international services, Waktel expects competition to toughen in the future.

"I fully expect that we will have more competitors down the road," said Waktel.

The state-owned Swedish carrier said it has already invested 2.7 billion krona (US$330 million) to increase its network capacity in overseas markets. The backbone of Telia's international network is the "Viking Ring," a fiber-optic network connecting London, Paris and Frankfurt am Main.

Earlier this month, Telia also unveiled a plan under which it will spend another 5 billion krona to further expand its international reach.

Telia also owns a transatlantic cable, called TAT-14, connecting its European network to the U.S.

Telia, in Stockholm, can be reached on the Web at http://www.telia.se.

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