Through his holding company Atlas Investissement, the boss and founder of Free is pursuing his international expansion strategy with a predominant player in this region of the world.
The file has been under consideration for weeks, but this time the offer is officially on the table. Xavier Niel, via his holding company Atlas Investissement, proposed on Monday to buy back the entire capital of the telecoms operator Millicom – of which he is already the largest shareholder, with 29% – by valuing it at 4.1 billion euros. Under the Tigo brand, this telecoms company based in Luxembourg and listed both in Sweden and on the American Nasdaq is present in around ten Latin American countries (Guatemala, Bolivia, Colombia, Costa Rica, Salvador, Honduras, Nicaragua, Panama and Paraguay).
Atlas is offering $24 per share in cash, the offer being entirely financed by the funds at its disposal and by the banks BNP Paribas, Crédit Agricole, JPMorgan, Natixis and Société Générale. This price represents a premium of 17.2% on the average price on Nasdaq for the last three months (as of May 22) and 37% compared to the 365-day average, argues Atlas in the hope of rallying the maximum number of shareholders. .
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Although the offer has not yet been examined by the board of directors, an independent committee has however expressed reservations about the price level proposed by Atlas, which had to recognize on May 23 exploring a public purchase offer to following information revealed by the Bloomberg agency. « An offer at 24 dollars would significantly undervalue Millicom in view of expected financial performance », write the members of this committee, highlighting in particular the free cash flow of 550 million dollars anticipated by the company for this year. This opinion has not however been officially submitted to the board, insists Atlas.
Present in the capital of Millicom since November 2022, when he acquired 7%, Xavier Niel then increased to 20% in February 2023, then to 29%. Three of his close friends have sat on the board of directors since May 2023: Thomas Reynaud, the general director of Iliad, Aude Durand, his deputy general director and Maxime Lombardini, former CEO of Iliad who became president and director of operations of Tigo since September. « Atlas looks forward to continuing to expand the reach and capacity of Millicom’s networks and distribution capabilities to grow its customer base and better leverage its global telecommunications expertise. », explains the company in a press release in order to clarify the timing of its offer.
Belgium, Ukraine, Ireland
By swallowing Millicom, Atlas would practically double the number of its customers. Today present in nine countries in Europe, Atlas claims 50 million subscribers to its services in mobile and fixed telephony. A number equivalent to the mobile customer base of Millicom. Taking control of Tigo would allow it to fully control strategic decisions and benefit more from the operator’s value creation. « Atlas seeks to support the development and profitable growth of the telecoms sector through targeted investments in assets that offer opportunities for significant value creation », recalls the industrial investor.
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Millicom’s situation has not been easy in recent years. Heavily in debt, to the tune of $5.9 billion, the company had to face the consequences of a sharp rise in inflation in very competitive markets. In this context, it generated a turnover of $5.6 billion in 2023. At the start of the year, Millicom praised the first results of the Everest project, launched in February 2023, a vast cost reduction plan implemented implemented in all its geographic areas. Atlas Investissement believes it now has sufficient visibility on Millicom’s trajectory to now want to move up a gear. A sign of this improvement, Millicom shares, listed on the Nasdaq, have increased by around 36% since the start of the year.
Increasing its presence on the South American continent is part of the international strategy that Xavier Niel has been leading for several years. Stone by stone, the boss and founder of Free continues its expansion via different investment vehicles. After Belgium, Ukraine and Ireland in recent months, it has become the reference shareholder, with more than 20% of the operator Tele2 in the Baltic and Nordic countries. After acquiring 2.5% of Vodafone in September 2022, he twice presented offers to the British group to merge their activities in the Italian market. Without success at the moment.
