A merger that would create Portugal’s second-largest telco appears to be a step closer after cableco Zon Multimedia and Sonaecom, which owns wireless operator Optimus, offered remedies to the Portuguese Competition Authority.
The Autoridade da…
A merger that would create Portugal’s second-largest telco appears to be a step closer after cableco Zon Multimedia and Sonaecom, which owns wireless operator Optimus, offered remedies to the Portuguese Competition Authority.
The Autoridade da Concorrencia will now market test the proposed commitments.
While details of the remedies package were not disclosed, TelecomFinance understands they centre on Optimus’ FTTH partnership with Vodafone.
Optimus has a network which passes 200,000 homes, as does Vodafone. They offer wholesale access to each other giving them each the possibility of offering services to 400,000 properties. One estimate has the two operators servicing a total of 80,000 customers, although official figures have not been disclosed. The aim of the conditions would be to preserve Vodafone’s status in the venture.
Zon’s MVNO is understood not to be subject of the remedies. The service has struggled for subscribers and Zon’s five-year contract with Vodafone is set expire later this year.
The proposed remedies will now be put to Zon and Optimus’ competitors for comment – a process which is expected to take less than two weeks.
The deal between Zon and Optimus was agreed in January and the antitrust regulator started its review in February. After more than five months analysis the parties are hopeful that the process will now accelerate and a tentative closing date of mid to late August has been suggested.
The parties do not expect the competition authority to pursue an in-depth review, but if it did that would push a closure date back to mid-October at the earliest.
Zon and Optimus have said their merger will create synergies of up to €400m. The deal values Optimus at two thirds of the value of Zon and as part of the merger Zon will also increase its share capital.
Optimus is 100% owned by Sonaecom, which proposed the merger in December alongside Zon’s largest shareholder Isabel Dos Santos, Africa’s first female billionaire according to Forbes. Dos Santos increased her stake in the cableco from 10% to 30% last year.
Sonaecom and Dos Santos have agreed to create a vehicle that will hold a controlling stake in the merged business. Dos Santos would contribute all her holdings in Zon to the joint venture, while Sonaecom would add a substantial part of its stake in Optimus.
The 50-50 joint investment vehicle would likely hold 50% plus one share in the company.
Optimus’ board is being advised by BPI and Santander. Zon’s board is being advised by Espírito Santo and Caixa BI.
