Kinnevik’s Tele2 stake acquired by Freya
February 26, 2024
Freya Investissement, a special investment vehicle jointly owned by iliad and NJJ Holding, has entered into a binding agreement to acquire approximately 19.8 per cent of the share capital of Tele2 from Kinnevik, an investment company focused on digital consumer businesses. Consideration for the transaction will be paid in cash and totals approximately SEK 13 billion (€1.16 billion).
The transaction is in part subject to regulatory approvals, which Freya says it is confident to receive. Furthermore, the transaction will not entail that Freya will be under any obligation to make a mandatory takeover offer to the shareholders of Tele2.
Tele2, a company listed on Nasdaq Stockholm Large Cap, has an established track record as a telecom challenger in Northern Europe and is a leader in Sweden and the Baltic region. The Company’s brand and assets, particularly in infrastructure, have contributed to its long-term operational and financial performance.
As a shareholder, Freya says it intends to be a supportive, long-term investor and engage with Tele2’s governing bodies and management team, using the experience of Freya’s team to further Tele2’s growth.
As a special investment vehicle jointly owned by iliad and NJJ Holding, Freya has significant telecom expertise and this believes it is ideally placed to help Tele2 continue to perform successfully. Both iliad and NJJ Holding are owned by Xavier Niel, a renowned entrepreneur and long-term investor in the telecom sector. Niel has investments in nine countries in Europe, with nearly 50 million active subscribers and revenue of more than €10 billion. iliad is the fastest growing international operator in Europe with its presence in France, Italy and Poland, while NJJ has a presence in Switzerland, Ireland, Monaco, Cyprus and Malta.
Key transaction terms
The transaction has received the unanimous support of the boards of directors of iliad, Freya and Kinnevik, and has been split into three tranches:
- In Tranche 1, Freya will acquire from Kinnevik 31,329,972 B shares representing 4.5 per cent of the share capital of Tele2 (3.5 per cent of the voting rights). The closing of Tranche 1 will take place shortly after signing.
- In Tranche 2, Freya will acquire from Kinnevik 14,202,766 A shares and 85,549,182 B shares representing, in aggregate with Tranche 1, approximately 18.8 per cent of the share capital of Tele2 (28.8 per cent of the voting rights). Tranche 2 closing is conditional upon receiving regulatory approvals.
- In Tranche 3, Freya will acquire all remaining shares held by Kinnevik, i.e. 6,531,199 A shares, in aggregate with Tranche 1 and Tranche 2, resulting in Freya owning approximately 19.8 per cent of Tele2’s share capital. Tranche 3 closing is, if applicable, conditional upon receiving regulatory approvals.
As part of the agreement Freya will acquire Kinnevik’s entire current shareholding in Tele2. Freya confirms that, post-completion of Tranche 3, it will remain below the threshold requiring a mandatory takeover offer in Sweden (being 30 per cent of the outstanding voting rights).
The Parties expect the closing of Tranche 2 to occur during the second quarter of 2024 and the closing of Tranche 3 to occur, at the latest, during Q3 2024.
Thomas Reynaud, director of Freya and CEO of iliad Group, commented: “The iliad Group and the Tele2 Group have a lot in common. We both believe in the power of innovation and the importance of an entrepreneurial mindset. Our business sector in Europe is highly demanding. So, we have a great deal of respect for what Tele2’s shareholders, management and teams have achieved, and we’re delighted that Kinnevik has chosen Freya as Tele2’s new reference shareholder. We look forward to contributing to the next chapter of Tele2’s growth story.”