Cinven, KKR and Providence complete the acquisition of Spanish telecommunications operator, MASMOVIL
The acquisition of MASMOVIL demonstrates a commitment from the Consortium towards the development of the Spanish telecom market over the coming years
Madrid, Spain, 17 November 2020 – Lorca Telecom Bidco SAU, a company indirectly and collectively majority owned by funds or vehicles managed or advised by Cinven, funds or vehicles managed or advised by KKR and funds or vehicles managed or advised by Providence Equity Partners L.L.C. (“Providence”) (jointly “the Consortium”), has successfully completed the acquisition of Spanish telecommunications operator MASMOVIL IBERCOM, S.A. (“MASMOVIL” or “the Group”) having acquired 99.3% of the Group’s outstanding shares. At the tender offer price, MASMOVIL was valued at approximately EUR 5.3 billion.
The Consortium’s support will provide MASMOVIL with the opportunity to accelerate its investment strategy and develop new projects aimed at providing the Group’s customers, who report some of the highest satisfaction rates in Spain, high quality access to MASMOVIL’s networks at a time when the telecommunications sector is becoming increasingly important in the country.
In addition, this transaction aims to continue creating value for the telecommunications market, customers, and employees of the Group, in addition to, delivering a positive impact on people and on the planet – in line with MASMOVIL’s corporate purpose.
Headquartered in Madrid, MASMOVIL is the fourth largest telecommunications operator in Spain, with more than 11 million customers. It provides triple-play fixed-line, mobile and internet services to residential customers, businesses and operators through a number of brands including Yoigo, MASMOVIL, Pepephone, Llamaya, Lebara, Lycamobile and Hits mobile.
The Consortium believes MASMOVIL represents an attractive investment opportunity because of its strong positioning in Spain, the increasing demand for greater quality and value for money in the Spanish telecommunications sector, and the range of growth opportunities available for the business over the medium-term.
Commenting on the transaction, Jorge Quemada and Thomas Railhac, Partners at Cinven, said:
“We are delighted to have completed the acquisition of such a major European business which has become the leading challenger in Spain. The experienced management team has demonstrated its ability to consistently deliver excellent results, even in fast changing environments. MASMOVIL has a highly successful track record and has achieved revenue and double-digit EBITDA growth both organically and through acquisitions and, more recently, through the actions they have taken since COVID-19. We strongly believe MASMOVIL is well positioned in the market for further exciting growth opportunities.”
Iñaki Cobo and Jean-Pierre Saad, Partners at KKR, said:
“We are excited to invest behind one of our core themes, telecommunications and digitalization, and are confident that MASMOVIL is well positioned to continue capturing growth opportunities with its outstanding management team. The investment in MASMOVIL reinforces KKR’s commitment to Spain where we have already deployed almost $6 billion since 2010.”
Robert Sudo, Managing Director at Providence Equity, said:
“As a long-standing investor in MASMOVIL, we continue to see exciting growth opportunities for the business and are pleased Cinven and KKR share our long-term vision for the company. The management team’s proven track record leading the business places MASMOVIL in a strong position to succeed as a private business in a competitive market ripe for consolidation.”
The offer document with all the information about the voluntary tender offer are available on the following website: https://www.grupomasmovil.com/en/takeover-bid-on-masmovil-group/
Advisors to the Consortium for this transaction, included: Barclays, Deutsche Bank and Morgan Stanley (M&A); Freshfields Bruckhaus Deringer LLP, Paul Weiss, Rifkind, Wharton & Garrison LLP and Uria Menéndez (legal); Analysys Mason and McKinsey (commercial); Deloitte (financial, tax, operations, structuring); and EY (IT)
Cinven is a leading international private equity firm focused on building world-class global and European companies. Its funds invest in six key sectors: Business Services, Consumer, Financial Services, Healthcare, Industrials and Technology, Media and Telecommunications (TMT). Cinven has offices in London, New York, Frankfurt, Paris, Milan, Madrid, Guernsey, Luxembourg and Hong Kong. Cinven has significant experience in the telecoms and fibre sectors, with its funds’ previous investments including Numericable, Ziggo, Eutelsat and Ufinet. Cinven also has a long-term presence and a successful track record in Spain, with its funds’ current investments in the country including Ufinet International, Hotelbeds, Planasa and Tinsa. Cinven takes a responsible approach towards its portfolio companies, their employees, suppliers, local communities, the environment and society. Cinven Capital Management (V) General Partner Limited, Cinven Capital Management (VI) General Partner Limited, Cinven Capital Management (VII) General Partner Limited and Cinven Capital Management (SFF) General Partner Limited are each authorised and regulated by the Guernsey Financial Services Commission, and Cinven Partners LLP, the advisor to the Cinven Funds, is authorised and regulated by the Financial Conduct Authority. In this press release ‘Cinven’ means, depending on the context, any of or collectively, Cinven Holdings Guernsey Limited, Cinven Partnership LLP, Cinven (LuxCo1) S.A., and their respective Associates (as defined in the Companies Act 2006) and/or funds managed or advised by any of the foregoing. For additional information on Cinven please visit www.cinven.com and www.linkedin.com/company/cinven/.
KKR is a leading global investment firm that manages multiple alternative asset classes, including private equity, credit and real assets, with strategic partners that manage hedge funds. KKR aims to generate attractive investment returns for its fund investors by following a patient and disciplined investment approach, employing world-class people, and driving growth and value creation with KKR portfolio companies. KKR invests its own capital alongside the capital it manages for fund investors and provides financing solutions and investment opportunities through its capital markets business. KKR has significant experience in the telecom sector, with its previous and current investments including United Group, Telxius, Deutchse Glasfaser and FiberCorp. KKR has a long-term presence and commitment to Spain having invested almost $6 billion since 2010 across different strategies, including current investments in PortAventura, Telxius, X-Elio, Alvic Group, Telepizza and MasterD.
References to KKR’s investments may include the activities of its sponsored funds. For additional information about KKR & Co. Inc. (NYSE: KKR), please visit KKR’s website at www.kkr.com and on Twitter @KKR_Co.
About Providence Equity Partners
Providence is a premier global private equity firm with more than $49 billion in capital under management. Providence pioneered a sector-focused approach to private equity investing with the vision that a dedicated team of industry experts could build exceptional companies of enduring value. Since the firm's inception in 1989, Providence has invested in more than 200 companies and is a leading equity investment firm focused on the media, communications, education, software and services industries. Providence has a long history of investing in the telecommunications space in Europe and is currently a shareholder in both Masmovil (2016) and Bite (2016). The firm’s previous European telecommunications investments since 2005 include: Volia (2007), M7 Group (2007), MobileServ (2006), Kabel Deutschland (2006), Com Hem (2006), TDC (2006), and Ono (2005). Providence is headquartered in Providence, RI, and also has offices in New York and London.
For more information, please visit www.provequity.com