The independent committee of the Board of
Directors of Millicom (Tigo) continues to believe the public cash
offers made by Atlas Luxco S.à r.l. significantly undervalue
Millicom’s shares and SDRs and reiterates recommendation not to
tender
(issued pursuant to the Swedish Takeover
Rules)
On August 2, 2024, Atlas Luxco S.à r.l.
announced it has increased the offer price of its public cash
offers from USD $24.00 to USD $25.75 per common share and SDR. The
independent committee is of the unanimous opinion that the revised
offers continue to significantly undervalue Millicom and recommends
that shareholders and SDR holders not accept the offers. In
evaluating the Offers at the Revised Offer Price, the independent
committee conducted an overall assessment as discussed in detail in
section 2 below and also considered an updated opinion from Nordea
that is described in section 1
below.w.
- Background
Luxembourg, August 9, 2024 –
This statement is made by the independent committee1 (the
“Independent Committee”) of the board of directors
of Millicom International Cellular S.A.
(“Millicom”) pursuant to section II.19 of the
Takeover Rules for Nasdaq Stockholm and Nordic Growth Market NGM
(the “Takeover Rules”).
On July 1, 2024, Atlas Luxco S.à r.l.
(“Atlas”), a subsidiary of Atlas Investissement
S.A.S., announced separate but concurrent public offers in Sweden
(the “Swedish Offer”) and the United States (the
“US Offer”, and together with the Swedish Offer,
the “Offers”) to the shareholders of Millicom to
tender all of their outstanding common shares in Millicom (the
“Common Shares”), including Swedish Depositary
Receipts representing Common Shares (with each Swedish Depositary
Receipt representing one Common Share) (the
“SDRs,” and together with the Common Shares, the
“Shares”) to Atlas, for USD 24.00 per Common Share
and USD 24.00 per SDR (the “Original Offer
Price”). Holders of Common Shares and SDRs are
collectively referred to below as
“Shareholders”.
On July 15, 2024, the Independent Committee
issued a statement in which it unanimously recommended that
Shareholders not accept the Offers at the Original Offer Price (the
“First Recommendation”). In the First
Recommendation, the Independent Committee detailed a number of
factors that should be considered by Shareholders when assessing
the Offers. Additionally, in support of its recommendation and to
provide Shareholders with further information in view of their
decision on whether to accept the Offers, in the First
Recommendation, the Independent Committee provided an update on
Millicom’s long-range plan.
On August 2, 2024, Atlas revised the Offers to
increase the Original Offer Price to $25.75 per Common Share and
$25.75 per SDR (with respect to the Swedish Offer, as converted
into SEK based on a USD/SEK exchange rate as close to the
settlement date of the Swedish Offer as Atlas is able to achieve,
the “Revised Offer Price”). Shareholders who have
already tendered Shares at the Original Offer Price will
automatically benefit from the Revised Offer Price without taking
any further action.
All references to the “Offers” below refer to
the Offers at the Revised Offer Price and as otherwise amended and
supplemented by Atlas since it initially made the Offers on July 1,
2024, including as amended by amendments to the Offer to Purchase
(as defined below).
The Offers, at the Revised Offer Price, value
the total number of outstanding Shares in Millicom at approximately
USD 4.4 billion (currently corresponding to SEK 47.4 billion,
converted at USD/SEK exchange rate of 10.70).
The Revised Offer Price (which was announced
prior to Millicom’s announcement of its financial results for the
second quarter of 2024, as discussed in Section 2 below)
represents:
- A premium of 5.8 per cent compared to the closing SDR price on
Nasdaq Stockholm of SEK 258.0 on June 28, 2024, the last full
trading day prior to the announcement of the Offers (converted at a
USD/SEK exchange rate of 10.60);
- A premium of 9.8 per cent compared to the closing SDR price on
Nasdaq Stockholm of SEK 251.6 on May 22, 2024, the last full
trading day prior to Atlas issuing a press release announcing that
it was exploring a potential all cash tender offer for the Shares
(converted at a USD/SEK exchange rate of 10.73);
- A premium of 17.6 per cent compared to the volume-weighted
average SDR price on Nasdaq Stockholm of 237.2 for the 30-day
trading period ending on May 22, 2024, the last full trading day
prior to Atlas issuing a press release announcing that it was
exploring a potential all cash tender offer for the Shares
(converted at USD/SEK exchange rate of 10.83);
- A premium of 7.1 per cent compared to the volume-weighted
average SDR price on Nasdaq Stockholm of SEK 252.7, for the 30-day
trading period ending on June 28, 2024, the last full trading day
prior to the announcement of the Offers (converted at a USD/SEK
exchange rate of 10.51);
- A premium of 4.9 per cent compared to the closing share price
on Nasdaq US of USD 24.55 on June 28, 2024, the last full trading
day prior to the announcement of the Offers;
- A premium of 9.2 per cent compared to the closing share price
on Nasdaq US of USD 23.58 on May 22, 2024, the last full trading
day prior to Atlas issuing a press release announcing that it was
exploring a potential all cash tender offer for the Shares;
- A premium of 17.2 per cent compared to the volume-weighted
average share price on Nasdaq US of USD 21.97 for the 30-day
trading period ending on May 22, 2024, the last full trading day
prior to Atlas issuing a press release announcing that it was
exploring a potential all cash tender offer for the Shares;
and
- A premium of 7.0 per cent compared to the volume-weighted
average share price on Nasdaq US of USD 24.07, for the 30-day
trading period ending on June 28, 2024, the last full trading day
prior to the announcement of the Offers.
According to the offer document for the Offers,
as initially made public by Atlas on July 1, 2024 and as later
supplemented on July 23, 2024, August 2, 2024 and August 8, 2024
(the “Offer to Purchase”), the initial acceptance
period for the Offers commenced on July 1, 2024, and ends on August
16, 2024 (such period, including any extension, the “Offer
Period”).
The estimated date of settlement continues to be
on or around August 29, 2024. Atlas has reserved the right to
extend the Offer Period and to postpone the settlement date.
The completion of the Offers continues to be
subject to the following conditions:
1. the Offers being accepted to such extent that
Atlas becomes the owner of Shares representing ninety-five (95) per
cent or more of the Shares, excluding Shares held in treasury by
Millicom;
2. no other party announcing an offer to acquire
Shares on terms that are more favorable to the Shareholders than
the Offers;
3. with respect to the Offers and completion of
the acquisition of Millicom, receipt of all necessary regulatory,
governmental or similar clearances, approvals, decisions and other
actions from authorities or similar, including from competition
authorities, being obtained, in each case on terms which, in
Atlas’s opinion, are acceptable;
4. neither the Offers nor the acquisition of
Millicom being rendered wholly or partially impossible or
significantly impeded as a result of legislation or other
regulation, any decision of a court or public authority, or any
similar circumstance;
5. no circumstances having occurred which could
have a material adverse effect or could reasonably be expected to
have a material adverse effect on Millicom’s financial position or
operations, including Millicom’s sales, results, liquidity, equity
ratio, equity or assets;
6. no information made public by Millicom, or
otherwise made available to Atlas by Millicom, being inaccurate,
incomplete or misleading, and Millicom having made public all
information which should have been made public; and
7. Millicom not taking any action that is likely
to impair the prerequisites for making or completing the
Offers.
Atlas has reserved the right to withdraw the
Offers in the event that it is clear that any of the above
conditions are not satisfied or cannot be satisfied. However, with
regard to conditions 2 – 7 above, the Offers may only be
withdrawn where the non-satisfaction of such condition is of
material importance to Atlas’s acquisition of Millicom or if
otherwise approved by the Swedish Securities Council
(Sw. Aktiemarknadsnämnden). Atlas has undertaken to act
reasonably and in good faith in making any such materiality
determination, and has stated that specifically with respect to
condition 2, Atlas’s determination of favorableness will be based
exclusively on the financial terms, likelihood of success of the
alternative offer (including with respect to the satisfaction of
any related conditions precedent) and whether the board of
directors of Millicom has unanimously recommended in favor of the
alternative offer.
Atlas has reserved the right to waive, in whole
or in part, one, several or all of the conditions to the completion
of the Offers set forth above, including, with respect to condition
1 above, to complete the Offers at a lower level of acceptance.
As of August 2, 2024, Atlas, through affiliates,
continues to be the largest shareholder of Millicom, and controls
approx. 29.17 per cent of the share capital and the total number of
votes in Millicom.
For information made available by Millicom or
Atlas relating to the Offers, please refer to
https://www.millicom.com/investors/public-offer. For information
made available by Atlas relating to the Offers, reference is also
made to www.atlas-investissement.com/en/offers.
Following Atlas announcing the Revised Offer
Price, Nordea Bank Abp, filial i Sverige, Corporate Finance
(“Nordea”) was engaged to provide a fairness
opinion to the Independent Committee in accordance with the
Takeover Rules. Nordea provided an opinion to the Independent
Committee dated August 8, 2024 stating that, as of August 8, 2024,
and based upon and subject to the matters considered, the
procedures followed, the assumptions made and various limitations
of and qualifications to the review undertaken set forth in such
opinion, the Revised Offer Price was not fair, from a financial
point of view, to the Shareholders (other than Atlas and its
affiliates) (the “Updated
Opinion”). The Updated Opinion is attached to this
statement. Nordea provided the Updated Opinion solely for the
information and assistance of the Independent Committee in
connection with its consideration of the Offers. Nordea’s Updated
Opinion does not constitute a recommendation to any Shareholder as
to whether or not the Shareholders should accept the Offers or any
other matter. In exchange for providing the Updated Opinion, Nordea
will receive a fixed fee which became payable upon delivery of the
Updated Opinion and is payable whether or not the Offers are
completed and is not contingent upon the Revised Offer Price or the
level of acceptance of the Offers by the Shareholders. Nordea is
considered to be independent as defined in the Takeover Rules.
Goldman Sachs International and Morgan Stanley
& Co. International plc are acting as financial advisors to
Millicom.
Davis Polk & Wardwell LLP, Nord Advokater
and Advokatfirman Lindahl and Hogan Lovells (Luxembourg) LLP are
acting as legal advisors to the Independent Committee and Millicom
in relation to the Offers.
- The Independent Committee’s statement on the
Offers
The Independent Committee has evaluated the
Offers at the Revised Offer Price in accordance with the provisions
of the Takeover Rules.
IN SUMMARY, FOR THE REASONS SET FORTH
BELOW, THE INDEPENDENT COMMITTEE CONTINUES TO UNANIMOUSLY RECOMMEND
THAT THE SHAREHOLDERS NOT ACCEPT THE OFFERS AND NOT TENDER THEIR
SHARES PURSUANT TO THE OFFERS, EVEN AT THE REVISED OFFER
PRICE.
In evaluating the Offers at the Revised Offer
Price, the Independent Committee conducted an overall assessment
and reviewed, considered and evaluated a significant amount of
information and factors, including potential benefits, detriments
and implications of the Offers, including at the Revised Offer
Price, to Millicom and the Shareholders, consistent with the
overall assessment described in the First Recommendation.
For, inter alia, all of the reasons set forth in
the First Recommendation (which continue to support the Independent
Committee’s recommendation with respect to the Offers at the
Revised Offer Price in this statement), the Independent Committee
continues to believe that the Offers, even at the Revised Offer
Price, significantly undervalue Millicom.
The Independent Committee’s review of the
Revised Offer Price also took into account Millicom’s strong
financial results for the second quarter of 2024, as publicly
announced on August 2, 2024. Among other highlights, Millicom’s
Revenue, EBITDA and Operating cash flow in the second quarter of
2024 grew 4.7%, 23.1% and 50.2%, respectively, year-over-year.
Equity free cash flow2 for the quarter was $268 million and
Leverage3 as of the end of the quarter decreased to 2.77x as of
June 30, 2024 from 3.10x as of March 31, 2024. Accordingly, the
results reiterated Millicom’s significantly increased Equity free
cash flow2 generation and supported previously announced
expectations that Millicom’s Equity free cash flow2 for full year
2024 is expected to be above $600 million (excluding proceeds for
the previously-announced tower sale in Colombia) and that
Millicom’s Leverage3 is expected to near 2.5x at year-end 2024.
In addition to the updated premia calculations
set forth in Section 1 above based on the Revised Offer Price, with
respect to certain trading multiples and control premia
calculations set forth in the First Recommendation:
- the
Revised Offer Price continues to be well below trading multiples
for comparable listed companies:
- while the
latest average enterprise value to 2024 concensus operating cash
flow multiple of Millicom’s Trading Peers4 is 7.8x, the Revised
Offer Price represents, as of August 1, 2024, a 40.4% discount to
the price per Share implied by applying the same multiple to
Millicom;5 and
- while the
latest average 2024 concensus Equity free cash flow yield of
Millicom’s Trading Peers is 9.3%, the Revised Offer Price
represents, as of August 1, 2024, a 33.3% discount to the price per
Share implied by applying the same yield to Millicom;5 and
-
the latest average control premia to undisturbed prices observed in
all-cash technology, media, and telecommunications transactions
involving targets that are considered to be large publicly listed
companies in the United States and Europe over the past 15 years
range between 17.4% and 46.4% (as described in the First
Recommendation), while the Revised Offer Price represents a limited
premium of 9.2 per cent compared to the closing price on Nasdaq US
of $23.58 (or 9.8% to the closing price on Nasdaq Stockholm of SEK
251.6 per SDR, converted at a USD/SEK exchange rate of 10.73) on
May 22, 2024, the last full trading day prior to Atlas issuing a
press release announcing that it was exploring a potential all cash
tender offer for the Shares.
The Independent Committee also considered the
Updated Opinion from Nordea stating that, as of August 8, 2024, and
based upon and subject to the matters considered, the procedures
followed, the assumptions made and various limitations of and
qualifications to the review undertaken set forth in the Updated
Opinion, the Revised Offer Price was not fair, from a financial
point of view, for the Shareholders (other than Atlas and its
affiliates). The full text of the Updated Opinion of Nordea, dated
August 8, 2024, which sets forth the matters considered, the
procedures followed, the assumptions made and various limitations
of and qualifications to the review undertaken in connection with
such Updated Opinion, is attached to this statement. For further
details on Nordea’s Updated Opinion, please see section 1 of this
statement.
IN LIGHT OF THE FOREGOING, THE
INDEPENDENT COMMITTEE CONTINUES TO UNANIMOUSLY RECOMMEND THAT THE
SHAREHOLDERS NOT ACCEPT THE OFFERS AND NOT TENDER THEIR SHARES
PURSUANT TO THE OFFERS, EVEN AT THE REVISED OFFER
PRICE.
- Impact on Millicom
and its employees
The Independent Committee’s view regarding the
impact the Offers will have on employees and employment, as set
forth in the First Recommendation, has not changed as a result of
the Revised Offer Price.
Regulatory Statement; governing
law
Certain information contained in this release
was prior to this release inside information and is information
that Millicom is obliged to make public pursuant to the EU Market
Abuse Regulation. This information was submitted for publication,
through the agency of the contact person set out below, at 2:00 pm
CET on August 9, 2024.
This statement shall be governed by and
construed in accordance with substantive Swedish law. Any dispute
arising out of or in connection with this statement shall be
settled exclusively by Swedish courts, and the District Court of
Stockholm shall be the court of first instance.
US Schedule 14D-9 statement
amendment
Following the issuance of this statement as a
press release, Millicom will file a Schedule 14D-9/A with the US
Securities and Exchange Commission, in which the Independent
Committee continues to unanimously recommend that Shareholders
not accept the Offers and not
tender their Shares pursuant to the Offers, even at the
Revised Offer Price.
Use of Non-IFRS Terms
This statement contains financial measures that
are not prepared in accordance with IFRS. These measures are
referred to as “non-IFRS” measures, and they are not uniformly or
legally defined financial measures. Non-IFRS measures are not
substitutes for IFRS measures in assessing Millicom’s overall
operating performance. Because non-IFRS measures are not determined
in accordance with IFRS, and are susceptible to varying
calculations, non-IFRS measures may not be comparable to other
similarly titled measures presented by other companies.
Millicom does not reconcile its forward-looking
non-IFRS financial measures to the nearest equivalent IFRS measures
because such reconciliations are not available without unreasonable
efforts, including due to the difficulty in making accurate
forecasts and projections and/or certain information not being
ascertainable or accessible.
Non-IFRS measures are included in this statement
because they are used by Millicom’s management, and Millicom
believes they provide investors with additional background for the
analysis of certain information set forth in this statement.
Millicom’s management uses non-IFRS measures to make operating
decisions, as they facilitate additional internal comparisons of
Millicom’s performance to historical results, and provides them to
investors for additional insight into Millicom’s operating
performance.
Non-IFRS measures have limitations as analytical
tools. The non-IFRS measures used by Millicom may be calculated
differently from, and therefore may not be comparable to, similarly
titled measures used by other companies. In addition, non-IFRS
measures should not be considered in isolation as a substitute for,
or as superior to, financial measures calculated in accordance with
IFRS. Millicom’s financial results calculated in accordance with
IFRS and reconciliations to those financial statements should be
carefully evaluated.
-END-
For further information, please
contact:
Press: |
Investors: |
Sofía Corral, Communications Director press@millicom.com |
Michel Morin, VP Investor Relations investors@millicom.com |
About Millicom
Millicom (NASDAQ U.S.: TIGO, Nasdaq Stockholm:
TIGO_SDB) is a leading provider of fixed and mobile
telecommunications services in Latin America. Through our TIGO® and
Tigo Business® brands, we provide a wide range of digital services
and products, including TIGO Money for mobile financial services,
TIGO Sports for local entertainment, TIGO ONEtv for pay TV,
high-speed data, voice, and business-to-business solutions such as
cloud and security. As of June 30, 2024, Millicom, including its
Honduras Joint Venture, employed approximately 15,000 people and
provided mobile and fiber-cable services through its digital
highways to more than 45 million customers, with a fiber-cable
footprint of about 14 million homes passed. Founded in 1990,
Millicom International Cellular S.A. is headquartered in
Luxembourg.
Independent Committee of the Board of Directors
Millicom International Cellular S.A. 2, Rue du Fort BourbonL-1249
LuxembourgGrand Duchy of Luxembourg
Stockholm, 8 August 2024
The Independent Committee (the
“Independent Committee”) of the Board of Directors
of Millicom International Cellular S.A.
(“Millicom”) is evaluating the separate but
concurrent public offers in Sweden (the “Swedish
Offer”) and the United States (the “US
Offer” and, together with the Swedish Offer, the
“Offers”) made by Atlas Luxco S.à r.l. (the
“Bidder”) to purchase all the outstanding common
shares with a par value of USD 1.50 per share (“Common
Shares”) and Swedish Depository Receipts representing
Common Shares (“SDRs”) of Millicom that are not
already owned by the Bidder or its affiliates. On 2 August 2024,
the Bidder announced increases in the price of the Offers to USD
25.75 in cash per Common Share and per SDR (the
“Revised Offer Price”). The full
terms and conditions of the Offers are set out in the offer to
purchase (the “Offer to Purchase”) (and, for the
US Offer, the accompanying letter of transmittal (together with the
Offer to Purchase, the “Offer Documents”)) dated 1
July 2024 (as amended and supplemented) and filed by the Bidder and
certain of its affiliates with the Securities and Exchange
Commission. According to the terms of the Offers, the Revised Offer
Price per SDR in SEK that will be paid to the holders of SDRs will
be set based on the USD/SEK exchange rate as close to the
settlement date as the Bidder is able to achieve.
Nordea Bank Abp, filial i Sverige, Corporate
Finance (“Nordea”) has been requested by the
Independent Committee to provide an opinion in accordance with the
Swedish Takeover Rules for Nasdaq Stockholm and Nordic Growth
Market NGM (the “Swedish Takeover Rules”) as to
whether the Revised Offer Price is fair, from a financial point of
view, for the holders of Common Shares and SDRs (other than the
Bidder and its affiliates).
As a basis for this opinion, Nordea has
considered:
- certain historical business and financial information relating
to Millicom, including annual reports and interim reports;
- certain financial projections for Millicom prepared by the
management of Millicom and approved for our use by the Independent
Committee;
- certain information from the management of Millicom regarding
Millicom’s business, operations and prospects, including historical
development, cost structure, strategy, management, financial
position, investments and future financial prospects;
- certain financial projections for Millicom contained in certain
securities analysts’ research reports;
- certain public information regarding Millicom that Nordea
considered to be relevant, including historical Common Share and
SDR prices and trading volumes;
- certain information from external sources regarding
the businesses of other companies which Nordea considered to be
relevant in evaluating those of Millicom and certain other
transactions which Nordea considered relevant in evaluating the
Offers;
- the Offer Documents, as amended and supplemented; and
- such other information as Nordea deemed necessary or
appropriate as a basis for this opinion.
The information on which this opinion is based
has been obtained from publicly available sources or furnished to
Nordea by Millicom or its representatives for the purposes of this
opinion. Nordea has relied upon the accuracy and completeness of
such information without performing any independent verification.
Nordea has assumed, with the Independent Committee’s consent, that
Millicom is not aware of any facts or circumstances that would make
such information inaccurate, inadequate or misleading in any way
meaningful to Nordea’s analysis. Nordea has not conducted an
independent valuation of Millicom’s assets and liabilities.
Nordea is not a legal, regulatory, tax or
accounting expert and has relied on the assessment made by Millicom
and its other advisers with respect to any such issues.
With respect to financial forecasts and other
forward-looking information presented to Nordea by the management
of Millicom, Nordea has assumed, with the Independent Committee’s
consent, that they have been reasonably prepared on bases
reflecting the best currently available estimates and judgements as
to the future financial and other performance of Millicom without
Nordea performing any independent assessment thereof.
This opinion is based on current market
conditions, economic, financial and other circumstances and the
information obtained by or provided to Nordea up to and including
the date of this opinion. Events or circumstances occurring or
becoming known after the date of this opinion may render this
opinion obsolete. Nordea assumes no obligation to update or revise
this opinion to reflect such events or circumstances.
Without prejudice to the generality of the
foregoing, this opinion is given as of the date hereof and does not
take into account the impact of any movement in the USD/SEK
exchange rate following the date hereof on the value of the SEK
equivalent of the Revised Offer Price to be received by holders of
SDRs upon the completion of the Offers.
This opinion does not address the relative
merits of the Offers as compared to any alternative business
transactions available to Millicom or any other investment
opportunities available to the holders of Common Shares and SDRs.
Furthermore, this opinion does not constitute a recommendation to
any holder of Common Shares or SDRs as to whether or not the
holders of Common Shares and SDRs should accept the Offers or any
other matter.
Based on and subject to the foregoing,
it is Nordea’s opinion that, as of the date of this opinion, the
Revised Offer Price is not fair, from a financial point of view,
for the holders of Common Shares and SDRs (other than the Bidder
and its affiliates).
Nordea will receive a fixed fee for its services
upon delivery of this opinion as well as cost reimbursement of
certain expenses, including legal fees. No part of the fee to
Nordea is contingent upon or related to the size of the Revised
Offer Price or whether the Offers are completed or not. Millicom
has also agreed to indemnify Nordea against certain liabilities
that may arise out of its engagement. Moreover, Nordea and its
affiliates have provided and may in the future provide certain
investment banking, commercial banking, financial advisory and
other services unrelated to the Offers to Millicom, the Bidder and
their respective affiliates and have received or may receive
customary fees for such services, including without limitation in
connection with its engagement as Joint Global Coordinator, Joint
Bookrunner and underwriter in connection with Millicom’s Rights
Offering in June 2022 and providing a fairness opinion in
connection with the Offers in July 2024. In addition, the Nordea
group may in the ordinary course of its trading, brokerage and
investment management activities, on its own behalf or on behalf of
other parties, trade or take positions in securities directly or
indirectly affected by the Offers.
This opinion is provided solely for the benefit
of the Independent Committee in connection with the Offers and in
accordance with and subject to the limitations set out in the
engagement letter between Millicom and Nordea, and may not be used
for any other purpose, except as specifically set out in the
engagement letter. This opinion may not, in whole or in part, be
published, publicly referred to, summarised or disclosed to or used
by any other party, nor may any public reference to Nordea be made,
without Nordea’s prior written consent, except as specifically set
out in the engagement letter. This opinion is not addressed to and
may not be relied upon by any third party including, without
limitation, creditors, shareholders and SDR holders of
Millicom.
This opinion is being provided under, and solely
for purposes of, the Swedish Takeover Rules and has been prepared
following customary Swedish standards and processes, which may
differ from those customarily followed in the United States or
elsewhere. This opinion shall be governed by and construed in
accordance with substantive Swedish law. Swedish courts exclusively
shall settle any dispute, controversy or claim relating to this
opinion.
NORDEA BANK ABP, FILIAL I
SVERIGECorporate Finance
1 Due to a conflict of interest based on
their relationship with Atlas (as defined below), Aude Durand,
Maxime Lombardini and Thomas Reynaud have not participated in the
Millicom Board’s handling of matters related to the Offers. All
such matters have been delegated to and handled by the Independent
Committee, which is comprised of the unconflicted members of the
Millicom Board, namely Mauricio Ramos (the Chair of the Board),
Maria Teresa Arnal, Bruce Churchill, Justine Dimovic, Tomas
Eliasson and Blanca Treviño de Vega. Given these circumstances,
Section III of the Takeover Rules is applicable to the Swedish
Offer.
2 Equity free cash flow is a non-IFRS
measure. Equity free cash flow is defined as Operating free
cash flow (as defined below), less finance charges paid (net),
lease interest payments, lease principal repayments, and advances
for dividends to non-controlling interests, plus cash repatriation
from joint ventures and associates. Operating free cash
flow is defined as EBITDA, less cash capex, less spectrum
paid, working capital and other non-cash items, and taxes paid.
EBITDA is defined as operating profit excluding impairment losses,
depreciation and amortization, and gains/losses on fixed asset
disposals. Cash Capex is defined as the cash spent in relation to
capital expenditure, excluding spectrum and licenses costs.
3 Leverage is defined as the ratio of Net
debt over LTM (last twelve month) EBITDAaL, pro forma for
acquisitions made during the last twelve months. Calculations of
Leverage in this statement assume that no capital allocation
activities or transactions, including distributions of dividends,
share repurchases, strategic transactions or similar activities or
transactions, have been undertaken by Millicom in the relevant
period(s). Net debt is defined as Debt and financial liabilities,
including derivative instruments (assets and liabilities), less
cash and pledged and time deposits. EBITDA after Leases (EBITDAaL)
is defined as EBITDA after lease interest expense and depreciation
charge.
4 “Trading Peers” include: Liberty Latin America
Ltd. (LILA), America Movil S.A.B. de C.V. (AMX), Telefonica
Brasil S.A. (VIVT3), and TIM Brasil Serviços e Participações S.A.
(TIMS3).
5 Comparable multiples and yields are
calculated on a proportionate basis, i.e., accounting for Operating
cash flow and Equity free cash flow as per Millicom’s definitions
at each subsidiary level and adding it pro rata to Millicom’s
ownership in each subsidiary. Operating cash flow is defined as
EBITDA less Capex. Capex is defined as balance sheet capital
expenditure excluding spectrum and license costs and lease
capitalizations.
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