Liberty Latin America calls off Millicom bid

23 January 2019 | Natalie Bannerman

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Liberty Latin America (LLA) has ended discussions to try to acquire Millicom and agree a deal.

In a statement published on its website, LLA said that it has “terminated conversations with Millicom International Cellular SA (Millicom) regarding a potential transaction.” Adding that the company is “focused on its growth strategy to deliver value for shareholders and provide market leading products and services to its customers.”

The news was also confirmed by Millicom through its own statement where is said that the preliminary discussions about a possible offer for all the shares of the company had been terminated by LLA “without an offer being made”.

Though no official reason has been given for the breakdown in talks between the two, according to Bloomberg sources close to the matter say that communications broke down because LLA was unable win over Millicom’s management with a takeover bid that values the company at $7.6 billion.

Both companies were set to meet over the coming days to agree a half-cash, half-stock offer that values Millicom at approximately $78.66 per share, confirmed the sources. But while Millicom’s largest shareholder, Kinnevik AB, a Swedish investment company, supported the proposal, LLA was unable to convince the company’s management.

Millicom’s management are said to be pushing for an offer with a higher cash premium from LLA, although the LLA’s reported proposal is said to represent a 23% premium on Millicom’s closing share price on 14 January, Millicom is also said to have some concerns about LLA’s high debt levels.

Share prices for LLA closed 7.1% on 22 January, while Millicom’s Nasdaq-listed shared closed the day down 0.4%. The company’s Stockholm-listed shares closed 1.4% the same day.

The news comes a week after LLA confirmed that it has submitted a proposal to buyout Millicom. At the time LLA said that no “definitive decision has been made”. While Millicom said, there was no guarantee that a transaction would materialise