The all-cash transaction values Claro Panamá at an enterprise value of $200 million and is equal to a mid-single digit multiple of Claro Panamá’s FY 2020 Adjusted Operating Income Before Depreciation and Amortization (OIBDA), including projected annual run-rate synergies.
"We are delighted to further increase our commitment to Panama through today’s announced acquisition of Claro Panamá. The integrated business will operate over a network with extensive coverage and invest to deliver innovative mobile products and services for Panamanian consumers and B2B customers, including via leading technologies such as 5G," said Balan Nair (pictured), president and CEO of Liberty Latin America.
"We at Liberty Latin America have established our group Operations Center in Panama and see the country as an important digital hub for the region, which we expect to drive growing demand for our full suite of mobile and fixed connectivity solutions. The valuation for the acquisition is consistent with our disciplined approach towards M&A and will be free cash flow accretive on a per share basis.”
For the period ended 31 December 2020, Claro Panamá generated $157 million of revenue and as of June 30, 2021, the business had 760 thousand mobile subscribers. The deal is to be financed using cash and incremental borrowings at Cable & Wireless Panamá with advisory services for Cable & Wireless provided by LionTree.
Subject to customary closing conditions, including regulatory approvals, the transaction is due to close in the first half of 2022.
In related news, March saw Liberty Latin America. reorganised its executive team, removing the role of COO from the company structure and adding two new executive team positions.
This has created a direct line of report between CEO Balan Nair and the business leaders for Cable & Wireless, VTR, and Liberty Puerto Rico.
