Business
Return to shareholders & completion of disposal
Return to shareholders & completion of disposal.
About this update from Zegona Communications Plc
[{"type":"text","content":"\n \nRNS Number : 1776M Zegona Communications PLC 26 July 2017 \n\nZEGONA COMMUNICATIONS PLC\n \n \n \nZegona TO RETURN £140M TO SHAREHOLDERS REPRESENTING 71p per zegona share\n \n \nLondon, England, 26 July 2017 - Zegona Communications PLC today announces the completion of the sale of Telecable to Euskaltel1and its intention to return £140m to shareholders via a tender offer\n \n \n \nThe sale of Telecable provides opportunity for significant capital returns to Zegona shareholders:\n· The transaction has generated significant upfront cash proceeds and Zegona intends promptly to return up to £140m to shareholders, representing 71p per share (44% of Zegona's market capitalisation2). \n· We plan to return capital through a tender offer conducted by an intermediary. Full details of the offer and the required general meeting3 will be set out in a circular to be sent to shareholders\n· Targeted 2017 dividend reconfirmed, £9.8m total pay-out (equivalent to 5p per existing Zegona share)4\n· Total cash return to Zegona shareholders from the proposed tender offer and dividends to the end of 2017 equals 55% of initial equity invested5, whilst still retaining exposure to underlying Euskaltel cash flows of similar magnitude to Telecable standalone6\n \n \nZegona sees potential to drive additional value through its 15% shareholding in Euskaltel:\n· Acquisition of Telecable establishes Euskaltel as the leading integrated telecoms operator in northern Spain with €711m Revenues, €346m EBITDA and €224m Cash Flow7. Euskaltel's increased scale and strong cash generation create a robust platform for growth\n· Substantial synergies available, valued by Euskaltel at €245m, equivalent to €1.37 per Euskaltel share8\n· Opportunity to close the current Euskaltel value gap - Euskaltel trades at an Equity Free Cash Flow yield of 12%, versus European Cable average of 5%9\n· Euskaltel Board strengthened by addition of Robert Samuelson (Zegona COO) and Jon James (ex ComHem COO)\n· Zegona expects to help drive Euskaltel pe...