Medellin City Council OK´s Sale of City’s Half-Stake in Tigo-UNE
The Medellin City Council on August 21 voted 16-5 to authorize the sale of the city´s 49.99% stake in internet/cell-phone/cable-TV giant UNE-EPM — the other half being owned by multinational telecom giant Millicom.
“With this decision of the Council, EPM will be able to concentrate on its strategic businesses, with quality public services for the community,” according to an EPM press bulletin immediately following the vote.
“The decision adopted by the Medellín Council allows us to concentrate on the development and growth of our strategic businesses in [electric power] generation, transmission and distribution of energy, [as well as] water supply, wastewater management, natural gas, solid waste and new solutions, including solar energy, biogas and hydrogen,” stated EPM general manager John Maya Salazar.
According to Colombian law, the sale of the city´s half-stake in UNE-EPM (Tigo) must trigger a three-stage process, although the first two stages could eventually be overcome by an outright sale to Millicom, its business partner.
During stage one, the City´s shares “must be offered to those meeting special conditions: active and retired workers of the company; associations of employees or former employees; workers’ unions; employee funds; severance and pension funds and cooperative entities, among others,” according to the EPM bulletin.
Those shares would be offered to the various parties at a “minimum base price” that would comply with Colombian law as well as the “shareholders agreement of UNE and [subsidiary company] Invertelco.”
“The base sale price of the shares will be based on a technical study that EPM will carry out accompanied by different independent advisors,” according to EPM.
“This analysis, which will consider the value of EPM’s investment in both companies, will be the main input for the EPM Board of Directors to decide the base sale price.”
Following that first stage, “the second stage is aimed at the general public. It is important to note that at these stages there may be different natural and/or legal persons interested in participating and acquiring shares of UNE and Invertelco,” according to EPM.
Following that second stage, the third stage would come into play: “In the event that the sale of EPM’s shares is not achieved in the two stages described above, [then] Millicom has the possibility of directly acquiring EPM’s shares in UNE,” according to EPM.
“If this does not occur, then there is the possibility of advancing a joint offer to the general public of 100% of the UNE shares owned by EPM and Millicom. EPM can use this public-assets protection clause until December 31, 2026.”
On the other hand, “if EPM completes the sale of the shares in the second stage, then the resources could enter the company’s budget at the end of 2025.”
In the alternative, “if the sale is carried out under the [first-stage] public assets protection clause, the resources could arrive at the end of 2026 or beginning of 2027,” EPM added.
