Sunrise agrees UPC takeover

28 Feb 2019

Swiss full-service provider Sunrise has signed an agreement to acquire its cable-based rival UPC Switzerland for an enterprise value of CHF6.3 billion (USD6.3 billion). As part of the deal, Sunrise will take on CHF3.6 billion of UPC’s outstanding debt and will undertake a rights issue to raise around CHF4.1 billion to fund the remaining cash payment of CHF2.7 billion and repay a portion of Sunrise’s existing debt. The acquisition is subject to regulatory approvals and Sunrise expects to receive the necessary permissions in Q2 or Q3 2019, with closing to take place during H2 2019. The deal will give Sunrise access to UPC’s infrastructure, which passes 2.3 million homes, and will add the company’s 1.1 million customers to its user base. UPC counted a total of 1.1 million video, 700,000 broadband and 520,000 voice subscriptions. According to Sunrise, the acquisition will ‘form a fully converged nationwide challenger across all elements of the 4P bundle, including wholesale fibre, cable and mobile,’ and strengthen its position as the number two player in the mobile, fixed broadband, TV and fixed voice markets.

Sunrise CEO Olaf Swantee was quoted as saying of the deal: ‘Today’s announcement is an important milestone for Sunrise, our customers, employees and shareholders. Together with UPC Switzerland, we will create a stronger, truly converged challenger and significant value for our shareholders. We are committed to accelerating innovation and enhancing customers’ experience, building on the enlarged scale of the combined business and superior next generation network infrastructure. We have undertaken an extensive due diligence exercise, which gives us a lot of confidence in the deliverability of the synergies. We are excited about the prospects of the combined business.’

Switzerland, Liberty Global (incl. LGI), Sunrise Communications, UPC Switzerland