UK-based investment firm Zegona Communications has announced a proposed partial tender offer for up to 14.9% of Spanish cableco Euskaltel at a price of EUR7.75 (USD8.92) per share. The offer price represents a premium of 18% over the closing price on 18 October 2018. Zegona currently owns 15.0% of Euskaltel and would increase its ownership to 29.9% if the tender offer is accepted in full. The tender offer will be funded through a non pre-emptive institutional placing, which has been fully underwritten by Barclays Bank.
Zegona – which acquired its stake in the company following the EUR701 million sale of Telecable de Asturias to Euskaltel in July 2017 – maintains that Euskaltel is a strategically attractive business with a strong competitive position in its home markets. Further, the UK investor believes there is potential to create significant additional value by driving efficiency improvements, increasing revenue growth in existing regions and accelerating expansion outside the current footprint.
TeleGeography notes that Zegona was established in 2015 with the objective of acquiring businesses in the European telecoms, media and technology sectors and using a ‘Buy-Fix-Sell’ strategy to deliver attractive shareholder returns.