Liberty Global to spin off Swiss telecom unit Sunrise (updated)

Liberty Global

16/02/2024 15:11

(Recasts with details and context throughout)
       ZURICH, Feb 16 (Reuters) - Liberty Global  LBTYA.O  said
on Friday it aimed to spin off its Swiss telecom unit Sunrise to
shareholders later this year following its $7.4 billion takeover
of the business in 2020.
    The listing on the SIX Swiss exchange is planned for the
second half of 2024, with two classes of shares, Liberty Global
said in a statement. 
    Sunrise will be listed with a long-dated, low-cost capital
structure supported by 1.5 billion Swiss francs ($1.7 billion)
of debt reduction, it added.
    The targeted debt reduction is expected to be accomplished
through Sunrise's expected free cash flow generation, debt
optimization and Liberty Global corporate liquidity, including
non-core asset disposals at Liberty Global, the company said.
        Sunrise, which competes with market leader Swisscom
 SCMN.S  in Switzerland is expected to have stable revenue and
stable to low single digit adjusted earnings growth in 2024,
Liberty Global said. Sunrise is expected to generate free cash
flow of 360-400 million francs this year.
        Liberty Global has appointed J.P. Morgan and UBS as
financial advisors on the operation, which is expected to be tax
free for U.S. shareholders of Liberty Global, with evaluation of
 tax treatment in other jurisdictions ongoing.
  
        Liberty is backing a listing with a strong capital
structure which alongside future cash generation potential "will
underpin Sunrise's attractive equity story and scope for
dividends," Liberty Global CEO Mike Fries said in a statement.
  
        Sunrise will host a capital markets day in due course to
provide more information on Sunrise and the spin-off.
  

 (Reporting by Paul Arnold; editing by Bartosz Dabrowski and
John Revill)
 ((dave.graham@thomsonreuters.com; Reuters Messaging:
dave.graham.thomsonreuters.com@reuters.net))