Millicom (Tigo) acquires Telefonica operations in Chile jointly with NJJ, structured to capture strategic value while protecting its balance sheet

Rhea-AI Summary

Millicom (TIGO) and NJJ agreed to acquire Telefonica’s Chile business via a 51%/49% jointly controlled vehicle, with Telefonica receiving an initial $50 million and earn-out up to $150 million.

Millicom will operate the business from day one; the asset is non‑recourse to Millicom and will not be consolidated. Telefonica must contribute CLP 79 billion (≈USD 92 million) at closing. Millicom holds call options in years five and six to acquire NJJ’s stake at a 10% discount to Millicom trading multiples.

Positive

• Strategic expansion into Chile strengthens South America footprint
• Operational control from day one despite 49% ownership
• Low upfront cash: initial payment of $50 million
• Non‑recourse structure protects Millicom balance sheet
• Five‑to‑six year call option to acquire NJJ stake

Negative

• Millicom initially holds a minority 49% stake
• Earn‑out up to $150 million is contingent and not guaranteed
• Acquired business will not be consolidated in Millicom financials

Key Figures

Initial closing payment: $50 million Earn-out consideration: up to $150 million Telefonica contribution: CLP 79 billion +5 more

8 metrics

Initial closing payment $50 million Paid to Telefónica at closing

Earn-out consideration up to $150 million Contingent on structural value creation

Telefonica contribution CLP 79 billion Allocated to payments and balance sheet stability at closing

Telefonica contribution (USD) approximately USD 92 million Closing balance sheet support

Ownership split 51% / 49% NJJ stake vs Millicom stake in joint vehicle

Millicom stake 49% Ownership of jointly controlled vehicle

Telefonica interest acquired 99.4% Interest in Chilean business representing full company

Option discount 10% Discount to Millicom trading multiples for call options in years 5–6

Market Reality Check

Price: $65.69 Vol: Volume 1,715,378 is 49% a...

normal vol

$65.69 Last Close

Volume Volume 1,715,378 is 49% above the 20-day average of 1,148,827, indicating elevated interest ahead of this acquisition. normal

Technical Trading at $68.28, essentially flat vs 52-week high of $68.93 and well above the $46.03 200-day MA.

Peers on Argus

TIGO gained 1.99% while key telecom peers also rose modestly (e.g., LBRDK +3.22%...

TIGO gained 1.99% while key telecom peers also rose modestly (e.g., LBRDK +3.22%, KT +1.44%), but no peers appeared in the momentum scanner, suggesting a company-specific reaction rather than a broad sector rotation.

Previous Acquisition Reports

5 past events · Latest: Oct 30 (Positive)

Same Type Pattern 5 events

Date	Event	Sentiment	Move	Catalyst
Oct 30	Telefónica Ecuador deal	Positive	+0.7%	Completion of USD 380M Ecuador acquisition expanding South American footprint.
Oct 07	Uruguay acquisition close	Positive	+0.2%	Completion of USD 440M Uruguay deal adding new market entry and synergies.
Jun 13	Ecuador deal signing	Positive	+1.6%	Definitive agreement to buy Telefónica Ecuador in a growing telecom market.
May 21	Uruguay deal signing	Positive	+0.4%	Agreement to acquire Telefónica Uruguay, expected EFCF accretion by 2026.
May 08	Tower sale Paraguay	Positive	+0.7%	Sale of ~300 towers in Paraguay with long-term leaseback structure.

Pattern Detected

Past acquisition headlines for TIGO have typically led to modest positive moves, suggesting the market often welcomes disciplined regional expansion.

Recent Company History

Recent news flow shows a consistent South American expansion strategy. Prior deals for Telefónica assets in Uruguay and Ecuador, at values like USD 380M and USD 440M, modestly lifted the stock (0.21–1.59%). Today’s Chile transaction continues this pattern of targeted acquisitions to strengthen TIGO’s regional footprint while emphasizing cash flow and balance-sheet discipline, fitting into a multi-country growth and integration story across Latin America.

Historical Comparison

acquisition

+0.7 %

Average Historical Move

Historical Analysis

In the past year, TIGO’s acquisition headlines averaged a 0.72% move. Today’s 1.99% gain sits above that norm, but still within a modest, positive reaction range.

Typical Pattern

Acquisitions of Telefónica assets in Uruguay and Ecuador, followed by today’s Chile transaction, show a stepwise expansion of TIGO’s South American footprint through targeted country entries.

Market Pulse Summary

This announcement details a joint acquisition of Telefónica’s Chile operations via a 51%/49% NJJ–TIG...

Analysis

This announcement details a joint acquisition of Telefónica’s Chile operations via a 51%/49% NJJ–TIGO vehicle, with a $50 million upfront payment and up to $150 million in earn-outs that are non-recourse to TIGO. The business remains unconsolidated initially, and Telefónica will inject CLP 79 billion to stabilize the balance sheet. Historically, similar South American acquisitions have led to modestly positive share moves, making execution quality and cash-flow generation key watchpoints.

Key Terms

earn-out, non-recourse, call option, trading multiples

4 terms

earn-out financial

"and be entitled to additional earn-out consideration up to $150 million"

An earn-out is a deal feature in mergers and acquisitions where part of the purchase price is paid later only if the acquired business meets specific future targets, such as revenue or profit goals. It matters to investors because it shares risk between buyer and seller—similar to paying for a used car only if it reaches promised mileage—affecting projected cash flows, valuation assumptions, and the likelihood of future payouts.

non-recourse financial

"financial obligations of the acquired company and the transaction are non-recourse to Millicom"

A non-recourse loan is a type of debt where the lender’s recovery is limited to a specific asset pledged as collateral, and the borrower cannot be personally pursued for any remaining balance if the asset’s value falls short. For investors, non-recourse financing shifts downside risk onto the lender and protects a borrower’s other assets, which can affect a company’s risk profile, borrowing costs, and potential returns — much like insurance that covers only the item left as collateral.

call option financial

"Millicom will have a call option to purchase NJJ’s share in the acquired business"

A call option is a contract that gives its buyer the right, but not the obligation, to buy a specific number of shares at a predetermined price within a set time period. Think of it as a refundable reservation to buy an item later at today’s price: you pay a fee up front and can profit if the stock rises, while your downside is limited to that fee; investors use calls to gain leverage, speculate on upside, or hedge positions without owning the shares.

trading multiples financial

"at a valuation based on Millicom’s then-prevailing trading multiples less a 10% discount"

Trading multiples are simple ratios that compare a company’s market price to a measure of its size or profit—think of price per square foot when valuing houses. Investors use these numbers, such as price-to-earnings or enterprise-value-to-sales, to quickly judge whether a stock looks expensive or cheap relative to peers or historical norms. They matter because they turn complex business performance into easy-to-compare snapshots for faster investment decisions.

AI-generated analysis. Not financial advice.

Millicom (Tigo) acquires Telefonica operations in Chile jointly with NJJ, structured to capture strategic value while protecting its balance sheet

Key Highlights:

Joint acquisition through a 49%/51% partnership between Millicom International Cellular S.A. (“Millicom”) and NJJ.

Transaction structured with an initial closing payment of $50 million and additional earn-out consideration up to $150 million based on structural value creation and not guaranteed by Millicom.
Acquired business will not be consolidated in Millicom’s financial statements during joint
ownership, and financial obligations of the acquired company and the transaction are non-recourse to Millicom. Telefonica will be required to assure CLP 79 billion (approximately USD 92 million) at closing for balance sheet stability.
Millicom will have the option to acquire NJJ’s stake in the business in Year 5 and 6 post-closing at a 10% discount to Millicom trading multiples, with NJJ having a later option to acquire Millicom’s stake with the same price methodology if Millicom does not exercise.
Acquisition reinforces Millicom’s strategic presence in South America and complements its regional footprint.

Luxembourg, February 10, 2026.  NJJ and Millicom International Cellular S.A. (“Millicom”) today announced the acquisition from Telefonica S.A. (“Telefonica”) of 100% of Telefonica’s interest in its Chilean business (representing 99.4% of the company), through a jointly controlled vehicle owned 51% by NJJ and 49% by Millicom.

Telefonica will receive an initial closing payment of $50 million and be entitled to additional earn-out consideration up to $150 million based on structural value creation. The earn-out consideration and any obligations of the acquired business, including its existing debt, will be payable from its cash flows and are not guaranteed by Millicom.

In connection with the joint acquisition, NJJ and Millicom are entering into a shareholders’ agreement pursuant to which Millicom will have a call option to purchase NJJ’s share in the acquired  business after the fifth and sixth years post-closing, at a valuation based on Millicom’s then-prevailing trading multiples less a 10% discount, payable with Millicom shares. If exercised, NJJ will be entitled to receive cash or Millicom shares for its transferred stake. If Millicom does not exercise its option, NJJ will have a call option to acquire Millicom’s 49% stake on similar pricing terms.

This structure enables Millicom to capture long‑term of a strategically expanded presence in South America while maintaining a healthy balance sheet and preserving financial flexibility.

At the closing, Telefonica will be required contribute CLP 79 billion (approximately USD 92 million) which will be allocated to satisfy certain payments and to ensure balance sheet stability.

Strategic Rationale

Although Millicom will initially hold a minority stake, the company will operate the business from day one and will apply the Millicom operational playbook to stabilize and strengthen the asset, drawing on its extensive regional experience.

As partners, NJJ and Millicom aim to enhance competitiveness and operational efficiency, capitalize on network modernization and service innovation, and support sustained investment in network quality and digital services in Chile. The transaction provides a distinctive opportunity to acquire and reposition a challenged asset in one of the region’s largest and most strategic markets at an attractive valuation, while preserving the strength and flexibility of Millicom’s balance sheet.

The joint acquisition reflects Millicom’s disciplined capital allocation strategy, prioritizing long-term value creation, operational improvement, and strong alignment with local market fundamentals.

Marcelo Benitez, CEO of Millicom, commented: “This transaction reflects Millicom’s disciplined and pragmatic approach to long-term value creation in Latin America. Partnering with NJJ allows us to combine complementary strengths while preserving financial discipline, balance-sheet protection, and strategic flexibility. We are taking an option on a large and important market through a thoughtful structure that limits upfront risk, isolates leverage, and fully protects Millicom from recourse. It gives NJJ and Millicom operational control from day one and the ability to capture long-term upside at an attractive valuation, without compromising our financial strength. Chile is a strategic market with solid fundamentals and strong demand for high-quality connectivity. We are committed to applying our operational playbook, investing with discipline, and supporting Chile’s digital development through better networks, better execution, and sustainable value creation over time.”

Country Profile: Chile

• Stable macroeconomic framework with strong institutions, prudent fiscal management, and a credible inflation-targeting regime, consistently recognized by the World Bank and the IMF.
• Sound public finances and a resilient financial system, supporting long-term investment and sustained economic growth.
• An open, globally integrated economy with strong trade linkages and a solid external position, contributing to macroeconomic resilience and policy credibility.
• One of Latin America’s most developed and competitive telecommunications markets.
• High mobile and broadband penetration, with continued demand for network quality and digital services.
• Market characterized by infrastructure-based competition and a strong focus on service quality and consumer protection.
• Ongoing opportunities for operational efficiency, network modernization, and service innovation.

-END-

For further information, please contact:

Press: Sofía Corral, Director Corporate Communications press@millicom.com

Investors: Luca Pfeifer, VP for Investor Relations investors@millicom.com

About Millicom

Millicom (NASDAQ: TIGO) is a leading provider of fixed and mobile telecommunications services in Latin America. Through its TIGO® and Tigo Business® brands, the company provides a wide range of digital services and products, including TIGO Money for mobile financial services, TIGO Sports for local entertainment, TIGO ONEtv for pay TV, highspeed data, voice, and business-to-business solutions such as cloud and security. As of September 30, 2025, Millicom, including its Honduras Joint Venture, employed approximately 14,000 people and provided mobile and fiber-cable services through its digital highways to more than 46 million customers, with a fiber-cable footprint over 14 million homes passed. Founded in 1990, Millicom International Cellular S.A. is headquartered in Luxembourg with principal executive offices in Doral, Florida.

About NJJ

NJJ Holding (“NJJ”) is the personal investment vehicle of Xavier Niel, a French entrepreneur and leading long-term investor with a strong global focus on telecommunications, alongside significant positions in real estate, media, and content production. Overall, Xavier Niel has telecoms investments in more than 20 countries worldwide, serving over one hundred million mobile subscribers.

Through NJJ, he is a major shareholder in the commercial real estate company Unibail-Rodamco-Westfield, holds hundreds of investments in startup tech companies, and has co-founded Mediawan, the first European independent production studio.

Xavier Niel (with his family, through Atlas Investissement) is the largest shareholder of Millicom with more than 40% of the capital.

FAQ

What are the key financial terms of Millicom's (TIGO) Chile acquisition announced February 10, 2026?

Millicom and NJJ buy Telefonica Chile with an initial $50 million payment and earn‑out up to $150 million. According to Millicom, Telefonica will also provide CLP 79 billion (≈USD 92 million) at closing and the asset is non‑recourse to Millicom.

How will the Chile acquisition affect Millicom's balance sheet and consolidation for TIGO investors?

The acquired business will not be consolidated and obligations are non‑recourse to Millicom. According to Millicom, this structure isolates leverage, preserving Millicom’s balance sheet strength and financial flexibility for shareholders.

What ownership and control rights does Millicom have in the Telefonica Chile deal for TIGO shareholders?

Millicom holds a 49% equity stake but will operate the business from day one. According to Millicom, operational control is granted immediately while ownership remains 49% initially under the joint vehicle.

What options does Millicom (TIGO) have to increase its stake in the Chile business and on what terms?

Millicom has call options in years five and six to buy NJJ’s stake at a 10% discount to Millicom trading multiples. According to Millicom, if not exercised, NJJ gets a reciprocal option on similar pricing terms.

What is the risk related to the earn‑out and future payments in the TIGO Chile acquisition?

Earn‑out consideration is contingent up to $150 million and payable from the acquired business cash flows. According to Millicom, these payments are not guaranteed by Millicom and depend on structural value creation.