Millicom Granted Option to Buy Out Honduran Shareholder
Published on: 1st Jul 2010
Note -- this news article is more than a year old.
Millicom International Cellular says that its local partner in Honduras has reached an agreement that gives Millicom full control of Celtel, its Honduran subsidiary. As a result of this agreement, Celtel will now be fully consolidated into the Millicom Group financial statements from Q3 2010. Previously, the results of the Honduras operations were proportionately consolidated.
Under the revised shareholders' agreement, the local partner has granted Millicom an unconditional call option for his 33% stake for the next five years. Millicom has granted a put option for the same duration to the local partner in the event of a change of control of Millicom.
While having no impact on reported net profit or Millicom's overall financial exposure to Honduras, the pro forma impact of this change on the Group financial statements for the year to December 2009 is to increase revenues by 6%, EBITDA by 7% and operating free cash flow by 9%.
According to statistics from the Mobile World analysts, Celtel ended last year with 4.74 million subscribers, representing a market share of 58.5%.