Bloomberg Línea — After five months of negotiations, Millicom International Cellular S.A. (TIGO) reported on June 15 that talks with Apollo Global Management Inc. (APO) and Claure Group had ended without a purchase agreement.
Both firms, which were seeking a “possible acquisition of all outstanding shares of Millicom”, according to the latter company’s statement, announced the end of discussions on a possible transaction, without any agreement.
From June 15 until the market close on June 21, the company’s shares on Wall Street fell 7.37%, from a value of $17.48 to $16.19.
It was on January 25 when the company, which operates the Tigo brand in Latin America, announced through its board of directors that it was discussing a possible acquisition of all outstanding shares of the company by Apollo Global Management and Claure Group.
However, at that time, they specified that there was “no certainty that a transaction would materialize or the terms, timing or form of any potential transaction”.
For the period in question and since the day of the announcement in January, the share price dropped from $18.25 on January 25 to $17.48 on June 15, when the talks ended, showing a variation of -4.21%. During this same period, the share’s low was recorded on February 3 ($16.45) and the high on February 14 ($20.61).
At the time, Bloomberg reported that the deal could value Millicom at nearly $10 billion, including debt. In addition, Apollo and Claure are reportedly trying to structure a bid to avoid repayment or refinancing of about $6.9 billion in Millicom debt, due to unstable financial markets.
On June 16, Millicom shares fell as much as 6.7% in pre-market trading after the company confirmed that talks with Apollo and Claure Group on a possible transaction had been terminated. On the same date, the Stockholm-based company’s shares fell 8.5%, Bloomberg reported.
Near the market close on Thursday, June 22, the shares were at $16.26, up slightly in the US versus Wednesday.
Other bets on Millicom
Although talks with the group of former SoftBank Group Corp. executive Marcelo Claure and Apollo Global Management have ended, there are other billionaires eyeing the telecommunications company.
Last year, French billionaire Xavier Niel acquired a 22% stake in the company, and in late April of this year, he said Millicom has the potential to continue to leverage value for its investors by using its infrastructure in different ways.
“We remain fully convinced that Millicom’s potential is untapped and underutilized, particularly in terms of the value of hidden assets and infrastructure. We have a clear vision of how opportunities can be seized and stand ready to bring our experience, passion and industry perspectives to Millicom’s board,” Niel wrote in a commentary reported by Bloomberg.
