FILE PHOTO: Swiss telecommunications company Sunrise is the logo of one of its stores in Zurich, January 14, 2015. REUTERS/Arnd Wiegmann/File Photo
ZURICH (Reuters) – Sunrise Communications has entered into “advanced discussions” to buy Liberty Global’s Swiss company, in a deal that values the internet and digital tv provider to 6.3 billion Swiss franc ($6.30 billion).
Sunrise said it would only pursue a deal for UPC Schweiz as the “strategically compelling and demonstrable creative value for its shareholders,” and said no final decision was made.
“In the case of a transaction, the Sunrise is committed to a prudent capital and to the preservation of the existing progressive dividend policy,” the mobile phone and internet services company said late on Tuesday.
A purchase will be able to enhance the Sunrise, the position of Switzerland as the second largest telecommunications company, and would be another European sales of Liberty Global that disposed of its Austrian business of T-Mobile Austria last year.
Analysts have said a tie-up makes sense, given the fact that the Sunrise and UPC’s of fixed and mobile services would make the combined entity a stronger competitor to the dominance of the state-controlled Swisscom.
Zurich-based Sunrise confirmed earlier this month it was negotiating to buy the UPC business, which is 1.1 million TV customers, but falling subscriptions and 138,000 mobile phone customers in Switzerland.
Sunrise is due to report its fourth quarter earnings on Thursday, while Liberty Global is due to report its full year results later on Wednesday.
Reporting by John Revill, editing by John Miller