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CVC sells stake in Denmark’s post office but acquires 50 per cent of Belgium’s

CVC Capital Partners has entered into a conditional sale agreement with the Danish state to sell its 22 per cent shareholding in Post Danmark as part of the planned merger between Post

CVC Capital Partners has entered into a conditional sale agreement with the Danish state to sell its 22 per cent shareholding in Post Danmark as part of the planned merger between Post Danmark and Posten of Sweden.

At the same time, the private equity firm has agreed with Post Danmark to acquire its entire ownership interest in De Post – La Poste, Belgium’s national postal service provider.

Following the transaction companies managed and controlled by CVC Capital Partners would own 49.9 per cent of De Post – Le Poste.

In 2005 CVC acquired a 22 per cent shareholder stake in Post Danmark as part of the initial privatization of the company by the Danish state. A common business plan for the development of the company had been agreed and CVC gained two board seats, including vice-chairman.

In 2005 Post Danmark and CVC, in consortium, were selected by the Belgian government as its strategic partner for the modernisation of the Belgian Post and as part of the partnership acquired a 50 per cent minus one share interest in the company. A common modernisation plan for De Post – La Poste was developed together with management.

On 1 April 2008, following several months of discussions, the Danish state, the Swedish state and CVC announced the intention to merge Post Danmark and Posten AB to create a Nordic postal operator. All parties agree that this is the best industrial solution for both companies, also in light of the forthcoming further deregulation of the European postal markets.

The parties have since the announcement worked on the preparations for the merger which was also announced today. As CVC would only become a small minority shareholder in the combined company, which is not consistent with its investment policies, it has been agreed that CVC will sell its shares in Post Danmark to the Danish state in connection with the proposed merger with Posten.

It has further been agreed with Post Danmark that CVC would acquire Post Danmark’s entire ownership interest in De Post – La Poste for EUR373m.

CVC partners Geert Duyck, Soren Vestergaard-Poulsen and Peter Tornquist say: "We are delighted to have reached agreements on the transactions; it also is a real tribute to the CVC cross office teamwork.

‘There is considerable industrial logic in combining the Danish and Swedish postal companies with potentially substantial benefits for customers, employees and owners and we are pleased to have contributed to the creation of that company. We wish the management team of the new Nordic postal business every success going forward.

‘We are also very pleased to be able to increase our ownership in De Post – La Poste to further cement our partnership with both the Belgian State and the excellent management team at the company. Over the past years a strong platform has been established and we look forward to continue supporting De Post – La Poste over the coming years."

Completion of the transactions are subject to customary regulatory approvals, final approval by the finance committee of the Danish parliament and consent to the change of ownership in De Post – La Poste by the Belgian government and the board of the Belgian Post.

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