Portuguese cableco Zon Multimedia and operator Optimus will not have to make a mandatory offer for all outstanding Zon shares following their merger.
Portugal’s securities commission, the Comissao do Mercado de Valores Mobiliarios (CMVM), has granted…
Portuguese cableco Zon Multimedia and operator Optimus will not have to make a mandatory offer for all outstanding Zon shares following their merger.
Portugal’s securities commission, the Comissao do Mercado de Valores Mobiliarios (CMVM), has granted an exception from the obligation to launch a mandatory bid for the remaining shares in Zon following a request by the merging parties.
Under the terms of the merger agreement Optimus’ parent Sonaecom and Zon’s largest shareholder Isabel Dos Santos, who holds a 30% stake in the cableco, will create a joint vehicle which they will each own half of. This in turn will hold 50% of the new company, plus one share, leaving current Zon investors in the minority.
Under Portuguese takeover regulation taking majority control would ordinarily trigger a mandatory offer, but the CMVM has now said Sonaecom and Dos Santos do not need to do this.
The CMVM decision had been expected after 99% of Zon investors had voted in favour of the merger in March. The merger documents had already included the exemption proposal.
The deal is still pending antitrust approval from the Portuguese Competition Authority (PCA). In the next couple of weeks it will reveal whether it will allow the merger to proceed or alternatively launch an in-depth analysis. Telecoms and media regulators have already expressed that they have no concerns with the proposed merger, but local reports have indicated that a in-depth analysis by the PCA may well be initiated.
The deal would result in considerable consolidation in the Portuguese market, creating a converged operator with annual revenues of €1.6bn. Merging the current third biggest wireless operator and the largest pay-TV provider would create the second largest telco in the country, behind only incumbent Portugal Telecom.
