Sale of Amena
Banco Santander Central Hispano SA
27 July 2005
Endesa, Banco Santander Central Hispano and Union Fenosa, the majority
shareholders of Grupo Auna, have reached an agreement in principle with Orange,
a subsidiary of France Telecom, for the sale of the mobile telephone business of
Auna, which is carried out through its affiliate company Amena. Minority
shareholders in Auna will have the option of participating as sellers in the
transaction.
The transaction will be carried out through the sale of 80% of the equity
capital of Auna following the spin-off of Auna TLC and other assets not related
to mobile telephony, which will be submitted to the Shareholders' Meeting of
Auna. The basic terms of the transaction are as follows:
• The initial price for 80% of the equity capital of Auna
(after the spin-off referred to above and excluding debt) is 6.4 billion euros,
subject to the usual adjustments in this type of transaction, which are mainly
the variations in indebtedness and working capital through the date of the
closing of the transaction. This price implies a valuation of 100% of the
business of Amena of 10.6 billion euros, including debt and minoritary interests
in Amena.
• At the request of the buyer, the sellers will reinvest part
of the amount obtained through the sale (up to a maximum of 3 billion euros, to
be determined by the buyer) in a new share issue by France Telecom, which they
will be proscribed from selling until 1 January 2007. From 1 January 2007 until
31 March 2007 the sellers can dispose of these shares, claiming from France
Telecom the difference, in their favour or against, between the sale price and a
value equivalent to the acquisition price plus an annual rate of 4%. Moreover,
the vendors will grant to France Telecom an option to buy said shares once they
have been subscribed, which can be exercised at the same value.
• Regarding the 20% of equity stock of Auna not being sold now,
such stake may be sold to Orange and / or France Telecom or to third parties, or
through a placement in the stock exchange, once three years have lapsed from the
initial purchase. A mechanism has been agreed upon, allowing a minimum
guaranteed price equivalent to 90% of the price per share paid by Orange in the
initial purchase, plus an annual rate of 4.5%.
After the close of the transaction France Telecom and Orange foresee the merger
of Auna (after the spin-off of the business of Auna TLC) and Amena with France
Telecom Espana (Wanadoo). Endesa, Banco Santander and Union Fenosa, together
with the other shareholders of Auna will participate in the share capital of the
company created by this merger. The sellers will have the right to designate,
jointly, at least one director of the company.
This transaction is subject to the approval of the appropriate administrative
bodies of the parties and the signing of final documentation, which is expected
to occur no later than July 29, 2005. The approval by the Shareholders' Meeting
of France Telecom of the capital increase that may be necessary to carry out the
abovementioned reinvestment will also be required. The transaction will also be
submitted to competition authorities.
Boadilla del Monte (Madrid) July 27, 2005
This information is provided by RNS
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