Sonaecom Offer to Buy Back Free-Float Shares Following Merger

Sonaecom SGPS SA offered to buy back as much as 24.2 percent of its stock, eliminating its free float, after it completed the merger of its mobile phone unit Optimus with a cable operator in Portugal.

Sonaecom is bidding as much as 216.8 million euros, the equivalent of 2.45 euros apiece for 88.5 million shares. Investors accepting the offer will receive shares in Zon Optimus SGPS, the telecommunications company formed by the merger, Sonaecom said in a regulatory filing yesterday.

The offer would remove from the market all the Sonaecom shares not controlled by parent company Sonae SGPS SA, Portugal’s biggest food retailer in terms of domestic sales, or by Sonae-affiliated companies and investors. Those shareholders own 74.3 percent of Sonaecom stock, and the remaining 1.5 percent is held by Sonaecom as treasury shares.

Optimus entered Portugal’s mobile market in 1998, grabbing a 19 percent of the market from Portugal Telecom SGPS SA and Vodafone Group Plc before Sonaecom’s 2000 IPO. It was never able to catch up with either of its larger competitors.

Sonaecom in August completed the merger of Optimus with what was formerly known as Zon Multimedia SGPS SA, the country’s biggest cable-television provider. Zon Optimus competes against Portugal Telecom and Vodafone for cable-television, Internet and telephone clients in Portugal.

Sonaecom rose 2.2 percent to close at 2.29 euros before the announcement in Lisbon yesterday. The shares have climbed 54 percent this year through yesterday’s close.

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