AS Starman

» see starman.ee as it lived, on the wayback machine

~ the eulogy ~

Estonia spent the 2000s being described as the most wired country in Europe, usually with reference to its digital ID cards and its online voting. The company that did most of the physical wiring inside its apartment blocks was Starman, founded in Tallinn in 1992 by Peeter Kern and Indrek Kuivallik, one year after the country left the Soviet Union.

It grew the slow way, by pulling coaxial cable through Soviet-era housing stock and selling television over it, and then internet and telephone service on the same line. The shares went onto the Tallinn Stock Exchange as SMN1T on 17 June 2006, and digital terrestrial television was added to the product list that December. In 2015 it bought the Lithuanian operator Cgates, which made it the largest cable company in the Baltic states rather than just the largest in Estonia.

By late 2016 it was the leading pay-television provider in Estonia with about 35 percent of that market, and second in fixed broadband with about 20 percent. The subscription counts at the end of that September came to roughly 122,000 for cable television and 88,000 for broadband, with another 90,000 split between digital terrestrial and telephony. Revenue for the year was 39.5 million euros.

The ending had no drama in it. Elisa closed the Starman offices and started serving the customers from its own on 1 January 2018, every Starman product moved under the Elisa brand, and the invoices began arriving from Elisa Teleteenuste AS. The trademark was simply ended.

~ the dossier ~

~ the founders' exit ~

The sale took five years and three owners. In 2013 the Swedish investment company East Capital Explorer bought 51 percent of the shares from the founders. Peeter Kern, who had run the company since it started, died unexpectedly in 2014. The Swedish stake moved on again in 2016, and in the middle of that December Elisa announced it would take 100 percent of AS Starman from Polaris Invest and Com Holding for 151 million euros in cash.

The Estonian Competition Authority cleared the purchase in March 2017, and Elisa had told the market it expected to close in March or April. One asset did not travel with the rest: the Lithuanian business, Cgates, stayed behind with the selling shareholders, so the Baltic company Starman had spent two years building was unbuilt at the moment of sale.

~ what the merger kept ~

Elisa wanted the households. Starman's 39.5 million euros of revenue was going up against the 99.3 million its buyer's Estonian arm had made in the same year, and the combined operation was described as a large employer by local standards at close to 1,000 people. The cable stayed where it was and the customers mostly stayed with it.

Estonia is also small enough to finish this kind of thing in a single night, and bigger markets do not get that option. A brand serving 1.3 million people can be retired over a New Year holiday, with no regional rollout and no transition period. In Turkey the retired names stayed on the sides of vans for years after the companies behind them were gone.

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