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Iliad SA update

Billionaire entrepreneur Xavier Niel launched a takeover offer to privatize the French telecommunications company Iliad he founded 22 years ago, an unexpected change of strategy by one of the wealthiest people in France.

This is the buyer’s use Low valuation Listed European telecommunications company. Another French telecommunications industry billionaire Patrick Drahi (Patrick Drahi), Privatize his Altice Europe Group Last year, and held a large number of shares in BT Group in June. Private equity buyers have also been circling among European telecom companies.

Niel already owns approximately 71% of Iliad’s equity, and the mobile and broadband provider has gained fame in France due to price cuts. Iliad markets its products under the Free brand, and also built a mobile business from scratch in Italy, and made its first major acquisition when it took over last year Polish mobile operator Play.

The company said in a statement that the bid will provide existing shareholders with 182 euros per share, a premium of about 50% over the average share price in the past month.

Neal said in a statement: “From now on, the new stage of Iliad’s development will require faster transformation and substantial investment, which will be easier to conduct as a private company.” “Our ambition for Iliad is to accelerate. Become a leader in European telecommunications.”

On Friday morning, Iliad’s share price rose 61%, slightly higher than the issue price, and its market value reached 10.85 billion euros.

Before the announcement, Iliad’s stock price had fallen by a third this year. Investors have been worried about the massive investment in Italy and the fierce price war in France. European telecom operators are also facing huge capital expenditures for the construction of 5G and high-speed fiber optic broadband networks.

Through the tender offer, Neal once again stated that he believes that the market underestimates the Iliad and its prospects.The first time he did this was in 2019, when he Enhanced his control As the stock price stagnated at half of its all-time high, he repurchased a large amount of capital at a price of 120 euros per share.

Iliad has further growth ambitions and expressed hope to expand to provide broadband services in Italy and Poland. On Friday, it announced that it had made a non-binding offer to John Malone’s Liberty Global to acquire its Polish cable TV operator UPC for US$1.9 billion (including debt). Both companies indicated that negotiations will continue.

In addition to the Iliad, Neal also owns a private company called NJJ Holdings, through which he owns other telecommunications assets, such as Ayr, Ireland And Salt Mobile in Switzerland.

He is also an active investor in the real estate sector, Led a radical movement Last year in Unibail-Rodamco-Westfield, it finally spent more than 1 billion euros to buy a 13.6% stake in Europe’s largest shopping mall operator.

The company said that Iliad’s board of directors “welcome” the tender offer and set up a committee to review its fairness and terms to minority shareholders.

JPMorgan Chase and Lazard are advising Niel. BNP Paribas, Crédit Agricole and Societe Generale will organize tender offers.

Additional report by Nic Fildes in London

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