UK investment firm Zegona will push ahead with talks to buy Telia’s 75 per cent stake in Spanish operator Yoigo, although Yoigo’s minority shareholders are not yet in full agreement about the deal.
In a statement, Zegona explained that it has reached an agreement with Telia “within the original exclusivity period” and has “fully agreed documentation and 100 per cent underwritten financing.”
However, “the Yoigo shareholder structure is complex and any transaction requires the agreement of all four shareholders individually and in aggregate.”
Without naming Masmovil, it also acknowledged that “there is another bidder interested in acquiring Yoigo” willing to offer a price “higher than that which Zegona considers to be fair and reasonable.”
It said Masmovil’s offer is conditional on due diligence, fully agreed documentation and the ability to secure significant financing.
Masmovil’s offer is thought to be in excess of €700 million, including 100 per cent of Yoigo’s equity plus debt.
In contrast, Zegona’s offer is inferior at around €550 million, including debt, but has the advantage of being fully guaranteed with the backing of Goldman Sachs, which has lined up banks to fund the bid. Masmovil’s bid is not guaranteed to the same extent.
Earlier this month, Zegona had warned Telia that it wanted the sale closed over the next few days or it would leave the process.
Now it has said that “given the current uncertainty of this new bid and our expectation of greater clarity within a relatively short period, the board considers it is in the best interest of shareholders that Zegona remains engaged in the Yoigo transaction.”
“It is our intention to progress this transaction as we continue to evaluate the many attractive opportunities for additional acquisitions across the broader European TMT [technology, media and telecommunications] landscape,” the statement added.
Zegona has been in talks about buying Yoigo for almost three months.
Yoigo is Spain’s smallest operator, trailing rivals Movistar (Telefonica), Orange and Vodafone with just a 7 per cent market share (3.3 million mobile connections).