Iliad proposes to Vodafone the merger of its businesses in Italy

MADRID, 18 Dic. (EUROPA PRESS) -

Iliad, an operator controlled by French magnate Xavier Niel, has presented a proposal to the Vodafone Group for the merger of the businesses of both companies in Italy through the creation of a new entity (NewCo) in which each company would control 50%.

Vodafone shares responded to Iliad's offer with a revaluation of more than 6%.

The merger offer, which has the unanimous support of Iliad's board of directors and its main shareholder, Xavier Niel, values ​​Vodafone Italia at €10.45 billion, while Iliad Italia would be valued at €4.45 billion.

Vodafone would get 50% of NewCo's share capital, along with a cash payment of €6.5 billion and a shareholder loan of €2 billion to ensure long-term alignment, while Iliad Italia would control 50% of NewCo. , along with a cash payment of 500 million euros and a shareholder loan of 2 billion euros.

As part of the proposed transaction, Iliad would have a call option on Vodafone's stake in NewCo and could acquire a block of 10% of NewCo's share capital each year at a price per share equal to the equity value at closing.

Should Iliad decide to exercise the purchase options in full, this would generate an additional €1.95 billion in cash for Vodafone.

"The proposal offers value and cash to Vodafone. The transaction also responds to Vodafone's publicly stated intention to transform and simplify the group," says Iliad.

"The market context in Italy demands the creation of the most innovative telecommunications competitor, with the ability to compete and create value in a competitive environment," said Thomas Reynaud, CEO of the Iliad Group.

In this sense, the executive has expressed his confidence that the profiles and complementary experience of both companies in Italy would allow the construction of a strong operator with the capacity and financial solidity to invest in the long term.

"NewCo would be fully committed to accelerating the country's digital transformation and, especially, the adoption of fiber and the deployment of 5G, with more than €4 billion of investment planned over the next five years," he added.