MásMóvil, a Spanish conglomerate, is in the final stages of the complete takeover of the Spanish Telecommunications company, Euskaltel. After emerging triumphantly from the takeover of the Basque telecommunications firm, the Spanish conglomerate is working at its full capacity to release one of the biggest financial operations of 2021, in an attempt to shake up the Spanish market. The operation will be financed with approximately 3,700 million euros.
MásMóvil’s principal banks have already begun a survey of the market so that the operations can commence in the next few weeks.
Civen, KKR and Providence took over the Spanish conglomerate for 2,900 million euros in 2020. The firm is now seeking to takeover Euskaltel for another whopping 2,000 million euros, with a rate of 11.7 euros per share. This acquisition will take place after safeguarding the staff of the Basque telecommunications company.
Euskaltel has agreed to the financing package of 3,700 million euros. The telecom possesses a bank consortium which comprises– BBVA, Santander, Sabadell, Barclays, BNP Paribas, Bank of America, Deutsche Bank, Goldman Sachs, Credit Agricole, Morgan Stanley, and Mizuho.
MásMóvil has divided the Euskaltel takeover bid into two packages
The 3,700 million euros debt is differentiated into two packages as mentioned in the catalog of the takeover bid. The first package for the takeover of Euskaltel comprises a loan of 800 million euros (TLB). It is a product of finance that is sold by banks to institutional investors. Advisory banks of MásMóvil will start the sanctioning of this loan in the next few weeks. The package is accompanied by a rotational liquidity line for an extra 200 million euros. The maturity rate is 6 years.
Strictly speaking, the loan is a gateway to the financing through which the private equity funds purchased MásMóvil in 2020. The value of the loan is about 2,200 million euros and another 500 million euros in liquidity lines, which is fully expended and positioned in the market. The firm is expecting the new financing to have a price that is similar to the old one – 3.5% for the rotational lines, and 4.25% for the term loan.
Additionally, MásMóvil has a second debt package for the takeover of Euskaltel. This comprises a bridge loan that is valued at 2.75 billion euros. The firm has collaborated with the same banks for this second loan, except the Bank of America. This package is further divided into three facets – one of 1,7500 million euros and two of 500 million euros.
The bridge loan possesses a magnificently long maturity rate for a debt of this type (7 to 8 years). MásMóvil intends to refund this loan quickly as the interest rates increase significantly over time. The firm recompenses an interest of 2.5% to 4.75% on this debt. The interest rates increase by 0.5% every three months.
The refunding of this loan will take place via amalgamated bonds and loans. Deutsche Bank acts as the coordinator for the issue of these bonds.
