Berne, 15 May 2007, 22:00
Swisscom is pleased to announce that its bid for Fastweb shares was successful. The acceptance level of its offer is at 80.7%. Together with previously acquired 1.7% of Fastweb shares Swisscom will own 82.4% of Fastweb. The total purchase price is EUR 3.1 billion. Together with the assumed net debt of Fastweb of EUR 1.1 billion the total transaction amounts to EUR 4.2 billion or CHF 6.9 billion. Swisscom plans to finance the transaction through new debt of around CHF 5.9 billion, the proceeds from the sale of Antenna Hungaria of CHF 0.5 billion and the placement of treasury shares for an amount of up to CHF 0.5 billion. As now all conditions set in the offer document have been fulfilled, settlement of the tender offer will take place on 22 May 2007.
Financial policy and new pay out policy
Going forward, Swisscom's financial policy envisages to:
limit its Net Debt to a maximum of around 2x EBITDA
pay out around 50% of annual OpFCF to Swisscom shareholders*) in the form of dividends and possibly share buy backs, whereby it aims to pay at least stable dividends going forward
review on an annual basis how much strategic flexibility (vs. the limit of around 2x EBITDA) is needed. Funds not required for strategic flexibility can then be returned to shareholders on top of 50% of OpFCF
make a special share buy back of CHF 500 million in 2008
*) Operating Free Cash Flow to Swisscom shareholders defined as EBITDA - Capex +/- changes in net working capital - minorities
Cooperation will now start
Swisscom will now start to cooperate with Fastweb management to develop future business plans and explore forms of cooperation in more detail. For Swisscom, the transaction is a logical step in the implementation of its corporate strategy aimed at growing its core business and increase company value through new activities. As a strategic partner committed to the long term, Swisscom is investing in Fastweb with the clear objective of further exploiting the Fastweb competitive advantages and technological lead as well as expanding its portfolio of offerings. Fastweb's operational business will continue to be separately managed. Within the next few weeks a General Assembly will be called and new members to the Board of Directors will be proposed.
Swisscom intends to continue working with the existing successful management team and retain the well-positioned Fastweb brand in Italy.