Cable & Wireless Communications Plc divests its 55% stake in Monaco Telecom for €322 million

LONDON, 28-4-2014 — /EuropaWire/ — Cable & Wireless Communications Plc (“CWC” or the “Company”) today announces that it has agreed the sale of Compagnie Monégasque de Communication S.A.M. (“CMC”), the holding company for CWC’s 55% stake in Monaco Telecom S.A.M. (“Monaco Telecom”), to a private investment vehicle controlled by Xavier Niel, the French entrepreneur and industrialist, for a total consideration of €321,788,000 (US$445 million) (the “Disposal”).

Monaco Telecom is the incumbent operator in Monaco where it is the market leader and only full service telecommunications provider. In addition, Monaco Telecom owns 36.75% of Telecom Development Company Afghanistan Limited (Roshan), a leading mobile telecommunications operator in Afghanistan. Monaco Telecom also operates a Service-to-Operator division, which amongst other activities supplies the international country code and international carrier services to Kosovo, and has a service contract with OnAir, a company that provides passenger telephony solutions on board aircraft.

The CMC Group reported revenue of US$218 million, EBITDA of US$74 million and profit before tax of US$52 million in the 12 months to 31 March 2013. At 30 September 2013, the CMC Group had US$537 million of gross assets, and approximately 35,000 mobile, 34,000 fixed line and 17,000 broadband customers.

The US$445 million consideration for the Disposal reflects Monaco Telecom’s strong financial performance and market position and represents a multiple of 8.4 times the CMC Group’s proportionate EBITDA based on results for the 12 months to 31 March 2013. The consideration is subject to customary adjustments relating to the amount of cash, debt and working capital at completion and will be paid in cash upon completion. CWC acquired 55% of Monaco Telecom in June 2004 for a price of €162 million.

CWC has received all required legal and regulatory consents to the Disposal from the Principality of Monaco and consequently completion of the Disposal is conditional only upon approval from CWC shareholders and there being no material adverse change in the Monaco Telecom Group prior to completion.

The Disposal is a further step in CWC’s strategy to focus on the Caribbean and Latin America region, and after completion of the Disposal, CWC will generate all of its revenue from the Caribbean and Latin America region, with the exception of the Seychelles.

The cash proceeds arising from the Disposal will reduce the Company’s net borrowings thereby increasing its strategic and financial flexibility. Including the proceeds from the Disposal, pro-forma net debt as at 30 September 2013 would have been US$82 million.

The Disposal puts CWC in a strong position to pursue growth opportunities, both organic and inorganic, in the targeted Caribbean and Latin America region. Any investments will be in line with CWC’s strict investment criteria and will be considered alongside regular reviews of balance sheet efficiency.

Phil Bentley, CEO of Cable & Wireless Communications, commented:
“We are pleased to have agreed the sale of our interest in Monaco Telecom with the support of the Principality of Monaco. Over 10 years under our management and in partnership with the Principality we have enhanced the services available to the residents and businesses of Monaco and achieved good returns.

“However, as we concentrate our business on the Caribbean and Latin America, we have taken this opportunity to crystallise the value we have created.

“Our Miami hub is now operational and with our balance sheet strength we intend to deploy the funds received in pursuing growth opportunities in our core region.”

A circular will be sent in due course to CWC shareholders containing further details of the Disposal, together with a notice convening a General Meeting of the Company to consider and, if thought fit, approve the Disposal. Completion is expected to occur in mid-May.

For further information contact:
Cable & Wireless Communications Plc

Investors:
Kunal Patel +44 (0) 20 7315 4083
Mike Gittins +44 (0) 20 7315 4184

Media:
Lachlan Johnston +44 (0) 20 7315 4006 / +44 (0) 7800 021 405
Steve Smith +44 (0) 20 7315 4070 / +44 (0) 7785 778 375

Advisers:
Evercore (Lead Financial Adviser and Joint Sponsor)
Bernard Taylor +44 (0) 20 7653 6000
Julian Oakley

J.P. Morgan Cazenove (Financial Adviser, Joint Sponsor and Joint Corporate Broker) Dwayne Lysaght +44 (0) 20 7742 4000
Tim Hume

Akira Partners (Financial Adviser)
Andre Sokol +44 (0) 7770 697 566
Matthias Uepping +44 (0) 7590 689 212

Maitland (Financial PR)
Neil Bennett +44 (0) 20 7379 5151

Notes to Editors:
About Cable & Wireless Communications Plc
Cable & Wireless Communications is a full service communications business. We operate leading communications businesses offering mobile, broadband and domestic and international fixed line services in most of our markets as well as pay TV, data centre and hosting, carrier and managed service solutions. Our operations are focused on providing our customers – consumers, businesses, governments – with world-class service. We are the market leader in most products we offer and territories we serve. For more information visit www.cwc.com.

About Monaco Telecom
Monaco Telecom is the incumbent operator in Monaco. Through Compagnie Monégasque de Communication S.A.M., the Group holds 55% of the total share capital of Monaco Telecom. The Principality of Monaco holds the remaining 45%. Monaco Telecom is the market leader and the only full service telecommunications operator in Monaco. In addition, Monaco Telecom owns 36.75% of Telecom Development Company Afghanistan Limited, a leading mobile telecommunications operator in Afghanistan. Monaco Telecom also has a Service-to-Operator division, which amongst other activities supplies the international country code and international carrier services to Kosovo, and has a service contract with OnAir, a company that provides passenger telephony solutions on board aircraft. Its Chief Executive Officer is Martin Péronnet.

Cautionary Statement
This announcement has been issued by, and is the sole responsibility of, Cable & Wireless Communications Plc. No representation or warranty express or implied, is or will be made as to or in relation to, and no responsibility or liability is or will be accepted by Evercore Partners International LLP (“Evercore”), J.P. Morgan Limited (which conducts its UK investment banking activities as J.P. Morgan Cazenove) (“J.P. Morgan Cazenove”) or Akira Partners LLP (“Akira Partners”) or by any of their respective affiliates or agents as to or in relation to, the accuracy or completeness of this announcement or any other written or oral information made available to or publicly available to any interested party or its advisers and any liability therefore is expressly disclaimed.

Evercore, which is authorised and regulated by the Financial Conduct Authority in the United Kingdom, is acting exclusively for Cable & Wireless Communications Plc and for no one else in connection with the matters described in this document and is not, and will not be, responsible to anyone other than Cable & Wireless Communications Plc for providing the protections afforded to clients of Evercore, or for providing advice in connection with the matters described in this document.

J.P. Morgan Limited (which conducts its UK investment banking business as J.P. Morgan Cazenove), which is authorised and regulated by the Financial Conduct Authority in the United Kingdom, is acting exclusively for Cable & Wireless Communications Plc and for no one else in connection with the matters
described in this document and is not, and will not be, responsible to anyone other than Cable & Wireless Communications Plc for providing the protections afforded to clients of J.P. Morgan Cazenove, or for providing advice in connection with the matters described in this document.

Akira Partners, which is authorised and regulated by the Financial Conduct Authority in the United Kingdom, is acting exclusively for Cable & Wireless Communications Plc and for no one else in connection with the matters described in this document and is not, and will not be, responsible to anyone other than Cable & Wireless Communications Plc for providing the protections afforded to clients of Akira Partners, or for providing advice in connection with the matters described in this document.

This announcement contains (or may contain) forward-looking statements which are subject to assumptions, risks and uncertainties associated with, amongst other things, the economic and business circumstances occurring from time to time in the countries, sectors and business segments in which the Group operates. These and other factors could affect the results, strategy and prospects of the Retained Group and/or Monaco Telecom.

Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, there can be no assurance that these expectations will prove to have been correct. Since these statements involve risks and uncertainties, actual results may differ materially from those expressed or implied by those forward-looking statements. Each forward-looking statement is correct only as of the date of the particular statement. The information contained in this announcement is subject to change without notice and, except as required by the rules of the London Stock Exchange, the Listing Rules, the Disclosure and Transparency Rules or any other applicable law, none of the Company, J.P. Morgan Cazenove, Evercore or Akira Partners assumes any obligation to publicly update or revise any forward looking statements contained herein, whether as a result of new information, future events or otherwise.