Liberty Latin America to buy controlling stake in UTS for $189m

26 March 2019 | Natalie Bannerman

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Liberty Latin America (LLA) has entered into a definitive agreement to acquire 87.5% of United Telecommunication Services (UTS) for $189 million.

The all-cash, debt-free deal will see LLA acquire scale in Curaçao and expands footprint to St. Maarten, St. Martin, Bonaire, St. Barths, St. Eustatius and Saba.

The enhanced national and regional scale will provide scale will give LLA a platform for both improved and new services for its customers as well as opportunities for future synergies.

“We are excited to welcome UTS to Liberty Latin America,” said Balan Nair (pictured), president and CEO of Liberty Latin America. “By consolidating these operations in Curaçao, we will form the largest full-service converged telecom operator on the island and create a true national champion, bringing world-class connectivity solutions to our customers on both fixed and mobile networks. In addition, through this acquisition, we are expanding our footprint in the region, allowing us to further leverage our operational scale and unique sub-sea network.”

The $189 million figure is based on an enterprise value of UTS, representing roughly 6 times the 2018 adjusted EBITA prior to the merger with the existing Cable & Wireless Communications business in Curaçao and integration into LLA’s regional operations.

Cable & Wireless Communications Limited along with VTR.com SpA (VTR) and Liberty Cablevision of Puerto Rico LLC, which now form Liberty Latin America. Liberty Global spun off its Latin America division back in February 2018 citing access to the capital and resources as one of the key reasons behind the decision.

As a company UTS provides fixed and mobile services in the region. Specifically video, broadband internet, fixed-line telephony and mobile LTE services to residential and business customers across Curaçao, St. Maarten, St. Martin, Bonaire, St. Barths, St. Eustatius and Saba. With 101,000 fixed subscribers and 134,000 mobile subscribers the majority of which are located in Curaçao.

The deal is expected to close over the coming days with LLA financing the deal through existing liquidity, including incremental revolver drawings at C&W Communications.