Simpson Thacher Represents TDC A/S on Merger of Swiss Business with France Telecom’s Swiss Business
11.30.09
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The Firm is representing TDC A/S, the Danish telecommunications company, on its agreement to merge its Swiss subsidiary, Sunrise Communications SA, with France Telecom’s Swiss subsidiary, Orange Communications SA. Under the agreement, which was announced on November 25, 2009, France Telecom will pay TDC a net amount of €1.5 billion and, as a result of a series of steps, become a 75% shareholder in the combined entity, while TDC will hold the remaining 25% of the shares. TDC’s shares in the combined entity are subject to a share buyback program to be executed at the board’s discretion in each of 2012, 2013 and 2014 on the basis of pre-agreed multiples applied to prior year EBITDA determined with a target net present value for TDC’s 25% stake of €1.2 billion.
With approximately 3.4 million mobile and 1.1 million fixed and broadband customers, the combined entity will account for around 38% of the Swiss mobile telephony market and 13% of fixed broadband connections. For 2008, the combined entity would have generated total pro-forma revenues of CHF 3.1 billion (€2.0 billion) and EBITDA of CHF 809 million (€534 million). The transaction is subject to conditions, including confirmatory due diligence and receipt of competition and regulatory approvals.
Simpson Thacher’s London-based team working on the transaction includes Mike Wolfson and Bart Gombert (corporate), and Nick Shaw (high yield and senior debt financing).