The discussions involve the potential acquisition by Millicom of Telefonica’s stake in Coltel for around US$400 million.
“The proposed combined entity would rejuvenate Colombia's telecom sector by forming a robust telecom entity with the necessary scale and financial capacity to support the significant network and spectrum investments required to achieve Colombia's ambitious digital inclusion objectives,” a release informing of the announcement said.
“Colombia will gain a second large-scale and financially viable operator at a crucial moment. This strengthened operator would bolster the digitalisation of Colombia, ensure broader access to modern digital services across the country and advance the deployment of both fibre and 5G technologies across the country, thereby enabling faster and more reliable services and an improved customer experience.”
Millicom also intends to offer to purchase La Nación’s and other minority interests in Coltel for cash at the same price per share offered to Telefonica.
Millicom intends to offer to buy Empresas Públicas de Medellin’s (EPM) 50% interest in TigoUne for cash at a “comparable valuation” to the Coltel acquisition.
Millicom says it plans to fund the proposed aggregate investment of around $1 billion in cash and assumed debt with equity-free cash flow projected over the next 18 months.
The deal is subject to negotiation and definitive agreements, as well as regulatory and antitrust approvals.
