The mega-merger on the Swiss telecommunications market, which initially failed, is now taking place, only under different circumstances. The US giant Liberty Global takes over the mobile operator Sunrise and merges it with its Swiss cable subsidiary UPC.
The takeover, which Sunrise’s board of directors has already approved, should take place by the end of the year, the companies announced on Wednesday.
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Freenet didn’t play along
Last year, plans by the Sunrise management for a takeover of UPC failed, among other things, due to resistance from major shareholder Freenet. The German group did not want to approve the capital increase necessary for the takeover. After the failed deal, Sunrise management resigned.
Freenet has now agreed to sell its Sunrise shares. Liberty Global offers 110 Swiss francs (around 103 euros) per Sunrise share. The paper recently quoted around 85 francs. This means that Sunrise is valued at around 6.3 billion euros. With 45.3 million shares outstanding, Freenet’s 24 percent stake is worth a good 1.1 billion.
Liberty Global wants to merge UPC and Sunrise into an integrated telecommunications provider that can offer cable TV, landline and mobile communications from a single source. Sunrise has around 2.5 million mobile customers and 500,000 landline customers in Switzerland. UPC has around one million cable customers. The merger would create a powerful competitor for the majority state-owned market leader Swisscom.