A Travers Smith cross-practice team has advised Zegona Communications plc on its proposed acquisition of Vodafone Spain for an enterprise value of €5.0 billion.
The transaction is financed through €4.2 billion of committed debt and €900 million of financing from Vodafone. Zegona also expects to launch an equity raise of up to €600 million and will consider a retail offer of up to €8 million via PrimaryBid.
Led by former Virgin Media executives Eamonn O’Hare and Robert Samuelson, Zegona was established in 2015 with the objective of investing in businesses in the European Telecommunications, Media and Technology sector and improving their performance to deliver attractive shareholder returns. The proposed acquisition marks Zegona's third transaction in Spain, all of which Travers Smith has advised on. It sold Telecable to Euskatel in 2017, taking a stake in the enlarged group, which in turn was sold to MásMóvil for €3.5 billion in 2021.
Vodafone Spain has a significant share in the domestic mobile, fixed broadband and TV markets, operating across the value spectrum with 3 strong offerings – Vodafone, Lowi and Finetwork – providing comprehensive low to high-end offerings.
Eamonn O'Hare, Zegona's Chairman and CEO commented: “We are very excited about the opportunity to return to the Spanish telecoms market. This financially attractive acquisition marks our third deal in Spain after successful turnarounds at Telecable and Euskaltel. With our clearly defined strategy and proven track record, we are confident that we can create significant value for shareholders.”
The Travers Smith team on this transaction is led by Aaron Stocks and includes Corporate Partners Mohammed Senouci, Tom Coulter and Ben Lowen, US securities partner Brent Sanders and Senior Associates James Lansdown, Fabian McNeilly and Holly McKinley, and Associates Will Fabbro, Sylvia Mueller, Jacob Pfeffer, Ella Price, Laura Priestley, Kristen Roth, Natalia Ivanova, Omar Farraj and Isabella Crossfield. Tax advice is being provided by Partner Madeline Gowlett and Head of Tax Russell Warren, Senior Associate Kyle Rainsford and Associate Jessica Baker; Technology and Commercial advice on the complex inter-company and separation arrangements is being provided by Partner Richard Brown, Head of Technology and Commercial Transactions Dan Reavill, Partner Ben Chivers, Senior Counsels Michael Cuthbertson and Michael Ross, Senior Associates Rosie Westley and Andy Maxwell and Associates Nick Brady, Isabel Cridland and Emma Riggs; and Regulatory advice (including in relation to the EU Foreign Subsidies Regulation) is being provided by Stephen Whitfield and Senior Associate Richard J. Brown.
Aaron Stocks commented: "We are delighted to have been able to facilitate another significant cross-border acquisition for Zegona. Their team's deep knowledge and proven track record in the telecoms sector in Spain means they are well-placed to deliver value for their shareholders. This deal continues to showcase Travers Smith's expertise in advising on multi-billion pound cross-border deals as well as our unparalleled expertise in utilising listed companies to deliver funding solutions for transactions. We have advised clients on the acquisitions of over 30 telecoms companies in Europe with a combined enterprise value of over €60 billion. This deal represents the largest reverse takeover ever concluded on the London Stock Exchange and proof that there remain great opportunities to capitalise on the London Stock Exchange's flexibility to list acquisition companies."
"We have very much enjoyed our seamless working relationship with Gómez-Acebo & Pombo Abogados, S. L. P. They joined the transaction at an incredible pace and provided excellent advice in a very dynamic deal environment. "
Deutsche Numis is acting as lead financial advisor to Zegona. ING Bank, UBS and UniCredit Bank also advised Zegona. Deutsche Bank, ING and UniCredit are leading the financing in connection with the Acquisition and acting as bookrunners and underwriters of the debt financing. Deutsche Numis is acting as global co-ordinator and joint bookrunner, with Canaccord, ING and UniCredit acting as joint bookrunners in connection with the planned equity fundraising. Zeus Capital Limited provided advice to the Non-executive Directors of Zegona in connection with the required Rule 9 Waiver under the Takeover Code.
