Weather Investments

A strategic partnership for global growth

Weather Investments is a global telecommunications company offering mobile, fixed-line, internet and international communication services to over 100 million subscribers in Southern Europe, North Africa and Asia. The company operates through its subsidiaries: Wind Telecomunicazioni and Wind Hellas and Orascom Telecom Holding:

• Wind Telecomunicazioni is the third largest mobile and second largest fixed operator in Italy.
• Wind Hellas (formerly TIM Hellas) is the number three mobile and fixed operator in Greece and a former Apax
  Europe VI portfolio company.
• Orascom Telecom Holding is a Cairo listed holding company of leading mobile operators in North Africa and Asia.

Apax Partners had long been attracted to the company because of the balance between the high growth characteristics of the emerging market portfolio and the cash flow stability of the more mature, Western European businesses.

In June 2008, Funds advised by Apax Partners together with two other firms, won a limited auction to buy a minority stake in Weather for €1.1bn, and a further investment later in the year increased the consortium’s stake.

Apax’ strong prior relationship with founder and CEO Naguib Sawiris was instrumental in ensuring that it secured the opportunity to invest, as Sawiris explains: “The reasons why we went with Apax were trust, chemistry and integrity. I initially came across them when I was trying to buy Wind Telecom in 2005 and, although the opportunity to work together on that did not materialise, we kept in touch and at the end of 2007 we were in contact again when Weather Investments acquired TIM Hellas from Apax. We did that deal from start to finish in three weeks and subsequently became very close to them through that deal”.

Sawiris, who founded the company from scratch to become the 11th largest Telecom provider in the world in terms of customer numbers, has clear ambitions for Weather. “Today we are 11th largest, but my ambition is to be among the five or six biggest telecom providers globally. I believe that having a critical mass of subscriber numbers is crucial because in the future more products and services will be run through the phone. Banking for us is a big potential revenue stream and we already have 100 million potential customers. In terms of payment, we own these relationships whereas a VISA or Mastercard do not”.

The growth achieved by Orascom and Wind in recent years is due in large part to the skills of the company’s management team in acquiring and integrating assets well and driving value. The current economic downturn provides both threats and opportunities for the group: “We have very strong management which will not let the market dictate to us”,says Sawiris. “We are currently concentrated on EBITDA and free cash flow across the group and on reducing debt. On the more offensive side, I think there will be lots of potential acquisition targets out there in the next couple of years”.

Apax has supported Weather on a number of initiatives on the strategic, operational and financial side to optimise the capital structure.

Commenting on the relationship to date, Sawiris concludes: “The relationship is strong, but they are tough and know the space well. They put our people under pressure and have ensured that the reporting discipline is in place across the group”.