The head of Swisscom, Jens Alder, has said the company is not going to make any major acquisitions abroad, despite having plenty of money in the bank.This content was published on January 10, 2002 - 14:05
However, Alder told an audience in Zurich that a share buy back programme was increasingly likely.
"The probability that Swisscom will go ahead with a buy back programme has increased," Alder said, commenting that this would benefit shareholders of the company, in which the government has a 65.5 per cent stake.
Alder said the alternative was to try to become one of the big players in Europe by making major acquisitions. However, he ruled that out.
He said six giants, led by Vodafone and Deutsche Telekom, currently dominated the European market. Swisscom, which is Switzerland's largest telecommunications operator, is seventh but a long way behind the sixth, Alder explained.
He said that if Swisscom wanted to make it into the "first division" it would have to buy the number eight or nine in the market.
"The risks of such an operation are too big," he commented.
Alder said that Swisscom favoured a strategy of "prudent growth", investing in niche markets abroad, as it had done with the German debitel company. However, he said that there were few opportunities.
As for the domestic market, Swisscom aimed at consolidating its position but growth possibilities were limited except in informatics. Alder, however, said that the group could improve its cash-flow position.
Commenting on Swisscom's relatively small size, Alder said that the company would try to remain independent "but not at all cost".
"Independence is an important aim but it is not set in concrete," he said.
Swisscom has paid off all its debts and has some SFr3 billion ($1.81 billion) in its "treasure chest". In the first nine months of 2001, the group doubled its net profit to SFr5.75 billion compared with the same period in the previous year.
"Swisscom has a very solid balance sheet. This is the result of our strong investment principles and a careful selection of opportunities. Swisscom is as solid as a rock," commented the company's chairman, Markus Rauh in August last year.
swissinfo with agencies
In compliance with the JTI standards