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Press Release
etel Group completes $50 million venture capital financing;
New investors are Dresdner Kleinwort Benson Private Equity, Argus Capital Partners, Greenhill Capital Partners and Intel Capital

Dublin -- Nov. 28, 2000 -- etel Group, one of Central Europe's leading competitive corporate telecommunications service providers, has raised $50 million in equity following the completion of venture capital financing, the company announced today.

The four investors participating in the financing are Dresdner Kleinwort Benson Private Equity, as lead investor; Argus Capital Partners, a private equity fund sponsored by the Prudential Insurance Company of America; Greenhill Capital Partners, a New York- based investment fund; and Intel Capital. ING-Barings, Ltd. acted as advisor to etel in this transaction.

The $50 Million raised will be used to execute etel Group's business plan, which includes the construction of state-of-the-art fibre optic Metropolitan Area Networks (MANs) in Prague, Budapest and Warsaw. These MANs will extend to seven other cities in the region and will be connected to etel's international gateway facility located in Frankfurt, Germany.

Mr Sean Melly, founder and Chief Executive Officer of etel Group, said that the successful completion of the institutional financing and the calibre of new investors accelerates etel's plans to develop and operate one of the most advanced telecommunications infrastructures in Central Europe.

"We have carefully selected our investors to reinforce etel's strategic focus: Central Europe, Telecommunications and Technology. Each of the investors excels in one or more of these areas of specialization. etel's ongoing development of our state-of-the-art telecoms network in Central Europe will enable us to provide high quality, cost competitive services to corporate customers. Our markets in the region are developing rapidly and we are confident of even larger growth potential in the years ahead."

Mr Janusz Heath, Director - Head of Central & Eastern European Private Equity of Dresdner Kleinwort Benson said: "Central Europe is a target investment area for us. As the move towards full EU integration progresses and the pace of deregulation accelerates, we see enormous growth potential in the main Central European markets. etel is establishing itself as a quality service provider in the Czech Republic, Hungary, Poland and Slovakia and is well-positioned to exploit the opportunities which have presented themselves in the telecoms area."

Ali Artunkal, Managing Director of ARGUS Capital Group, the advisor for ARGUS Capital Partners, said: "We are a Central European focused investment fund with a strong regional presence and etel's target markets match our investment mandate perfectly."

Robert Niehaus, Chairman of Greenhill Capital Partners, said: "We are very impressed with etel's approach of offering bundled voice, data and ISP services to corporate customers and see strong demand for a competitive provider in Central Europe's newly deregulated telecoms markets. We are confident that etel's strategy, combined with the impressive telecoms industry background of its management team, will make etel a market leader."

About etel Group
Established in July 1999, by Sean Melly, Founder and CEO of TCL Telecom, now WorldCom Ireland, and a former member of WorldCom's pan-European executive team, etel is Central Europe's leading competitive corporate telecommunications service provider and ISP. etel offers a portfolio of value-added voice, data and Internet solutions of the highest quality, speed and global reach.

Headquartered in Dublin, Ireland, etel is the only telecommunications company to focus exclusively on the Czech Republic, Hungary, Poland and Slovakia. With a combined population of 65 million, these four countries are preparing for accession to the EU and will liberalise their telecom markets within the next two years. etel will own and operate the most advanced telecom infrastructure in the region enabling it to control quality of service, offer an expanded range of broadband services and provide significant cost advantages.

The company is currently building state-of-the-art fibre optic metropolitan area networks (MANs) in Prague, Budapest and Warsaw and will extend these to seven other cities in the region. These MANs will be connected to etel's international gateway switching facility located in Frankfurt, Germany.

About Dresdner, Kleinwort, Benson
DrKB Private Equity is the private equity arm of Dresdner Kleinwort Benson, the Investment Banking division of the Dresdner Bank Group. The investment bank recently announced its proposed merger with US investment house Wasserstein Perella to create a world-class investment bank with full-service financing and distribution capabilities.

DrKB's Private Equity business ( ) has 3 billion euros in equity and mezzanine funds under direct and co-advisory management globally and ten investment teams making investments in medium sized LBO/MBO/MBI, emerging growth and VC stage transactions across Western Europe, Central & Eastern Europe, America and Asia. Investments are made with the Bank's own capital and funds committed by third parties to investment vehicles sponsored or co-sponsored by Dresdner Kleinwort Benson.

The Central & Eastern European Private Equity team is in the process of completing the first closing of its Emerging Europe Fund at an estimated $230 mn. eTel is one of a series of investee companies which will benefit from the Fund.

About Intel Capital
Intel Capital, Intel's strategic investment program, focuses on making equity investments and acquisitions to grow the Internet economy, including Internet infrastructure, content and services in support of Intel's strategic interests. In Europe Intel Capital invests through Intel Atlantic Inc., a subsidiary of Intel

About Argus Capital Partners
ARGUS Capital Partners (the "Fund") is a private equity fund with commitments in excess of US$170 million focusing on countries in Central and Eastern Europe. The Fund is sponsored by The Prudential Insurance Company of America ("Prudential"). Prudential is one of the largest life insurance companies of the world and has been active in private equity investing for decades. The Fund's other investors are sophisticated global institutional investors from North America, Western Europe, the Middle East and Far East.

ARGUS Capital Partners ("ARGUS") is managed by ARGUS Capital Group, a division of PRICOA Capital Group Ltd, which in turn is a subsidiary of Prudential. At present, ARGUS has offices in London and in the Czech Republic, Hungary and Poland with seven investment professionals.

About Greenhill Capital Partners
Greenhill Capital Partners is a $425 million private equity fund managed by Greenhill & Co., an independent investment banking firm owned entirely by its partners that provides mergers and acquisitions and strategic advisory services to clients worldwide. In 1999 alone, Greenhill & Co. advised on over $70 billion of transactions. Greenhill Capital Partners identifies investment opportunities by focusing on the proprietary deal flow provided by Greenhill & Co.'s insights into and relationships within the telecommunications, technology, financial services and consumer products

About ING Barings
ING Barings is the organization and trade name under which ING Bank N.V. conducts its activities in the field of international corporate and investment banking, including treasury services, M&A, corporate and sovereign lending, fixed income and equity origination, trading, sales and research. ING Bank NV. is part of ING Group, one of the largest financial groups in Europe.

Paul O'Leary,
Ogilvy Public Relations Worldwide
Tel: +44 (0)207 345 3480

Louise Dott,
Ogilvy Public Relations Worldwide
Tel: +44 (0)207 345 3183

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