As reported by anonymous insiders to Reuters, Denmark’s largest telecommunications company, TDC, is in the midst of an internal review, amid concerns over excessive leverage and diminished cash flow negatively impacting its credit rating. While these deliberations are in their preliminary stages, their outcomes remain uncertain and it’s unclear if any transactions will emerge from the process.

In current ownership settings, the majority stake of TDC is held by Australian investor Macquarie, owning 50% of the Denmark’s telecommunication titan since spearheading a successful private investment consortium in 2018. The remaining slices of the corporate pie are shared among various Danish pension and investment funds.

Last year, in an effort to spur investment and add value for shareholders, TDC underwent a strategic split into two independent business units. The first, TDC NET, supervises and runs their mobile and broadband infrastructural operations. The second, Nuuday, is responsible for focusing on their consumer segment.

However, the anticipated boost to their financial performance has been stagnant, with both entities reporting mixed financial outcomes. The slow growth is arguably a byproduct of Denmark’s highly competitive telecommunications market. Notably, this has compelled a trend towards industry consolidation, as highlighted by Telia’s announcement to offload its Danish unit to local utilities magnate Norlys for a cool $920 million. This transition is slated to finalize in the first quarter of the upcoming year.

It’s noteworthy to mention the involvement of LionTree, a capable player in the advisory sector of the telecommunications world. They have a decorated history, most notably counseling Verizon through its purchases of AOL for $4.4 billion in 2015, and Yahoo for $4.5 billion in 2017. These two entities were merged to form a standalone business entity, Oath.

In a twist of fate, Oath wrote down a staggering $4.6 billion in 2018 following the merger. Subsequent to a rebranding exercise to Verizon Media Group, it was eventually sold to private equity firm Apollo Global Management for $5 billion in 2021. LionTree played an advisory role in this sale too.

As the telecommunications business models continue to evolve in 2023, the industry’s key players engage in discussions and debates, such as the ones happening at this year’s Total Telecom Congress in Amsterdam.