Swedish cablenet Com Hem has announced plans to merge with mobile network Tele2.
The agreement would see Kinnevik has the largest shareholder in the operation with 27.3 per cent of the share capital. The next two largest shareholders, Norges Bank and MFS Investment, would hold 2.9 per cent each.
Com Hem’s owners will receive a 26.9 per cent stake in the merged entity and SEK 6.6 billion in cash (€671 million).
In a statement the companies said the merger would create a leading integrated operator by combining an award-winning mobile network with the fastest national fixed network and the widest range of content in the market. Over recent years the two companies have become increasingly close with a sustained period of joint strategic development.
The combined customer base will include 3.9 million mobile customers, 0.8 million broadband customers and 1.1 million digital TV customers in Sweden.
Mike Parton, chairman of the board of directors of Tele2 said: “We are delighted to have reached agreement to combine two great Nordic companies to create a leading integrated connectivity provider in the Swedish market. I take great pride in the outstanding returns Tele2 has delivered to its shareholders over the past years and the value we have delivered to our customers.”
After the merger Com Hem CEO Anders Nilsson will become the CEO of the enlarged Tele2. The company will be the second largest mobile telephony and fixed broadband provider in Sweden and the market leader in digital TV.
“Merging is the best possible next step for both companies as it will enable us to meet the demands of tomorrow and unleash the power for the best possible digital quality of life in Sweden,” said Nilsson. “I am proud of the progress we have made during the last few years in improving our products and services leading to increased customer satisfaction, expanding our footprint while delivering on all our financial targets.”
Andrew Barron currently Chairman of Com Hem along with at least one additional Com Hem Board Director will join the Board of Directors of Tele2, which will be chaired by Tele2’s proposed new Chairman Georgi Ganev.
The completion is subject to the approval of the two sets of shareholders and regulatory authorities.
