Millicom committee reaffirms recommendation against US$4bn Atlas offer

An independent committee formed by the board of Latin America-focused Millicom reaffirmed its recommendation to reject an all-cash tender offer for the telco’s outstanding common shares by Atlas Luxco (Atlas Investissement) because it undervalues the company. 

After publishing preliminary information, Atlas Luxco formally offered US$24 per share for a total of US$4.1 billion on July 1.

The committee added that the offer represents a negative 1.4% premium compared to the closing Swedish depository receipt (SDR) price on June 28 and negative 0.2 premium compared to the volume-weighted average SDR price for the 30-day trading period ending June 28, the last full trading day prior to the announcement. 

But the offer represented a premium of 2.4% compared to the closing SDR price from May 22, the last full trading day prior to Atlas issuing a press release announcing that it was exploring a potential all-cash tender offer. 

The committee also said the offer does not take into account expectations based on Millicom’s long-range plan of equity cash flow generation of US$659 million, US$701mn and US$833mn in 2024, 2025 and 2026, respectively.

The offer is valid through August 16. 

Through affiliates, Atlas is Millicom's largest shareholder, controlling 29% of the share capital and total votes.

Goldman Sachs International and Morgan Stanley are the financial advisers to Millicom.