Vodafone Group said it plans to buy Turkish operator Telsim Mobil Telekomunikasyon Hizmetleri for US$4.5 billion.
Telsim will require about US$1 billion of additional funding in the short term for investments in the operations and network of the operator, Vodafone said in a statement. Those investments are expected to result in losses for Telsim in the short to medium term.
Vodafone sees opportunities in Turkey with mobile phone penetration at around 53 percent. Currently, Telsim has 9 million customers, Vodafone said.
Vodafone is not acquiring Telsim's liabilities to Motorola. and Nokia. Motorola and Nokia both recently settled long-running lawsuits with Telsim over billions of dollars the vendors said weren't paid by Telsim. Some class action suits that were filed against Telsim by Motorola executives are still outstanding.
The deal must be approved by Turkish government bodies and the board of Turkish Savings Deposit and Investment Fund, the current owners of Telsim. Vodafone expects the transaction to close in the first quarter next year.