Spin-off Announcement - Liberty Global announces its intention to spin-off 100% of Sunrise to its shareholders, aiming to maximize shareholder value and allow shareholders to participate in the future growth of both Sunrise and Liberty Global [1] - The spin-off will leverage Sunrise's potential as a locally listed FMC challenger, building on the successful integration of Sunrise and UPC since 2020 [1] - The operational business will not be affected by the spin-off, ensuring continuity for customers, employees, suppliers, and other stakeholders [1] Strategic Rationale - The spin-off aligns with Liberty Global's strategy of unlocking value by allowing shareholders to directly participate in Sunrise's future performance [2] - Sunrise will be listed with a strong capital structure, supported by its future cash generation potential, which will underpin its attractive equity story and scope for dividends [2] - The spin-off aims to broaden and deepen the investor base by appealing to local Swiss/European investors and index/passive demand for Sunrise [5] Sunrise Investment Highlights - Sunrise has 100% exposure to the attractive Swiss telecom market, characterized by favorable macro fundamentals, a stable three-player structure, and a supportive regulatory framework [3] - It is the clear number two operator in Switzerland with scaled positions across fixed, mobile, and converged products, and boasts the best 5G coverage and next-generation fixed network [3] - Sunrise benefits from strong cash generation, a delevered balance sheet, and a long-term fixed-rate debt profile with an average maturity of 5 years and an average cost of debt of ~3% [3] - The company plans to offer an attractive shareholder remuneration framework, supported by its high cash-generating asset and experienced management team [3] Financial Guidance and Listing Details - Sunrise reported a strong Q4 2023 performance with a return to revenue and adjusted EBITDA growth, and provided financial guidance for 2024: stable revenue, stable to low-single-digit adjusted EBITDA growth, and adjusted FCF range of CHF360-400m [4] - The listing of Sunrise on the SIX Swiss Exchange is planned for 2H24, supported by up to CHF1.5B (7 billion, while its joint ventures (VMO2 and VodafoneZiggo) generate combined annual revenue of more than $18 billion [7] - Liberty Global Ventures has a portfolio of more than 75 companies and funds across content, technology, and infrastructure industries, including stakes in ITV, Televisa Univision, Plume, AtlasEdge, and the Formula E racing series [7]
Liberty Global Announces Intention to Spin-Off 100% of Sunrise to Shareholders