February 27, 2019
ZURICH (Reuters) – Sunrise Communications has entered “advanced discussions” to buy Liberty Global’s Swiss business in a deal which values the internet and digital television provider at 6.3 billion Swiss francs ($6.30 billion).
Sunrise said it would only pursue a deal for UPC Schweiz if it was “strategically compelling and demonstrably value creative for its shareholders,” and said no final decision had been made.
“In the event of a transaction, Sunrise is committed to a prudent capital structure and to retaining its existing progressive dividend policy,” the mobile phone and internet services company said late on Tuesday.
A purchase could strengthen Sunrise’s position as Switzerland’s second-largest telecoms company, and would be another European sale by Liberty Global which divested its Austrian business to T-Mobile Austria last year.
Analysts have said a tie-up makes sense, given that Sunrise and UPC’s fixed and mobile services would make the combined entity a stronger rival to the dominance of state-controlled Swisscom.
Zurich-based Sunrise confirmed earlier this month it was negotiating to buy the UPC business, which has 1.1 million TV customers but falling subscriptions, and 138,000 mobile phone clients in Switzerland.
Sunrise is due to report its fourth quarter earnings on Thursday, while Liberty Global is due to report its full year results later on Wednesday.
(Reporting by John Revill, editing by John Miller)