Cabovisão, ONI and Melita: Apax Partners strengthens its TMT pole

Duco-Sickinghe_managing_partner_524x524Apax Partners and Fortino Capital have recently taken control of telecoms operators Cabovisão (Portugal), ONI (Portugal) and Melita (Malta). Their plan is to turn these companies into regional champions.

 

“Not all operators need to belong to a major group”

For Duco Sickinghe, former CEO of the Belgian giant Telenet (turnover of €1,808.4m and EBITDA of €943.7m), Cabovisão, ONI and Melita are proof that “not all operators need to belong to a major group”. His company Fortino Capital has recently invested in these operators alongside Apax Partners. “In addition to financing the renewal of infrastructure and development projects, we contribute highly specialised expertise in the telecoms sector”. Cooperation with Apax Partners began over a dinner organised by some shared contacts: “We had dinner in Paris with three person of the Apax team, and we got on well together. They are very successful, modest and have a good sense of humour, which makes for an agreeable environment when you work long hours!”

Based in Portugal, Cabovisão is the number two cable operator in the country with over 900,000 homes connected and 190,000 subscribers. Its range is directed at retail customers and includes pay TV, internet and fixed-line telephony. ONI is also a Portuguese operator, which has developed its business in the corporate market. The leading operator of converged telecommunications networks in Malta, Melita has a mobile, fixed and WiFi network available to retail and corporate clients. Its 110,000 subscribers have access to pay TV, high-speed internet and fixed-line and mobile telephony.

Three drivers for value creation focused on client expectations

“For each of these operators we have identified drivers for value creation focused on client expectations” says Duco Sickinghe. The Managing Partner of Fortino Capital is convinced that the success of operators will depend on their ability to offer their subscribers a state of the art service.

Improving the infrastructure

“Our top priority for Cabovisão is to update the network and to select new internet modems to provide subscribers with the best technology.” Under threat for a time by the fibre optic lead in the race for very high-speed internet, the coaxial cable used by the Portuguese operator has returned to the forefront thanks to the DOCSIS 3.1 standard enabling speeds of well over 100 Mbit/s on cable networks. “This technology breakthrough has completely changed the situation of “cablecos”, which can now offer high-speed TV services and very high-speed internet” believes Duco Sickinghe. “Thanks to a modular investment strategy to update its infrastructure, the Cabovisão network will be able to compete with fibre optic networks”.

At Melita the focus is on updating the TV platform, on a very high-speed mobile network, with the aim of moving to 4G in 2017, and on speeding up the internet service by investing in WiFi equipment.

Launching new services

To raise turnover per subscriber and win new subscribers, the operators will extend their product ranges. Cabovisão and ONI will launch mobile services by the end of 2017 providing their subscribers with “bundled fixed and mobile services” using the network of MEO. Also planned: a new digital TV platform with a second-screen service (accessible on tablets and smart phones). Duco Sickinghe has great confidence in Melita’s potential: “Based on its excellent fixed and mobile coverage, Melita will develop new services such as the cloud”.

Refocussing on the client

The final prong in the Apax Partners and Fortino Capital strategy is to refocus marketing and the corporate organisation on the client. Marketing strategies will be reviewed to better segment subscribers offering them targeted services whilst restricting acquisition, upgrade and retention fees. “Client focus must be an integral part of a company’s structure. We place a great deal of emphasis on non-financial subscriber data, such as the NPS (Net Promoter Score) which measures responses to the question: “Would you recommend this product?” says Duco Sickinghe. “This score will be key for the operator’s future success”.

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