Kinnevik AB (publ) (“Kinnevik”) today announced that it has resolved to propose the distribution of its entire shareholding in Millicom International Cellular S.A. (“Millicom”) to its shareholders. Kinnevik has further resolved to amend its shareholder remuneration policy and cease to pay ordinary cash dividends in favor of paying out excess capital generated by its investment activities in the form of extraordinary dividends.
Kinnevik currently owns 37,835,438 Millicom shares, equivalent to 37.2 percent of Millicom’s total shares outstanding. Kinnevik’s Board of Directors intends to propose the distribution to an Extraordinary General Meeting of shareholders in time for the distribution to be carried out before the end of 2019. By distributing its entire shareholding in Millicom (in the form of Swedish depository receipts (“SDRs”) listed on Nasdaq Stockholm), Kinnevik will deliver an extraordinary distribution of value to Kinnevik’s shareholders of in total approximately SEK 19.0bn, corresponding to SEK 69 per Kinnevik share (based on the closing price of Millicom’s SDRs as at 16 September 2019). The complete terms for the distribution will be set out in the upcoming notice to the Extraordinary General Meeting.
Millicom was founded by Kinnevik almost 30 years ago. Since Millicom’s listing on Nasdaq Stockholm in 2004, Kinnevik’s Millicom investment has yielded significant dividends and returns to Kinnevik and its shareholders. In recent years, Kinnevik has actively supported Millicom’s strategy to focus the company’s footprint on cable and high-speed mobile operations in Latin America, creating a strong, consolidated and high-performing FMC player.
The recent announcements reinforce Kinnevik’s objective to dedicate a larger share of its portfolio to disruptive and technology-enabled growth and venture capital businesses. Through the distribution of the Millicom shareholding to Kinnevik’s shareholders, the contribution of these businesses to Kinnevik’s portfolio will increase materially, whilst retaining the stability of the continued ownership in two key platforms – Tele2, the leading connectivity challenger in the Nordics, and Zalando, Europe’s most prominent e-Commerce player. Kinnevik’s shareholders are also provided the option to directly participate in Millicom’s continued shareholder value creation and dividend yield.
In light of this significant distribution of value and step change in Kinnevik’s portfolio composition, Kinnevik has resolved to revise its shareholder remuneration policy. Kinnevik’s prior objective was to pay an annual dividend growing in line with dividends received from its investee companies and the cash flow generated from its investment activities. Going forward, Kinnevik will generate shareholder returns primarily through capital appreciation, and will seek to return excess capital generated by its investments to shareholders through extra dividends.
Kinnevik will be hosting a Capital Markets Day on 19 September 2019 in Stockholm, Sweden, to present an update on its portfolio evolution and its growth-focused investment strategy. The program includes presentations by Kinnevik’s management team, as well as from a selection of the entrepreneurs leading Kinnevik’s investee companies. The Capital Markets Day will be webcast on Kinnevik’s website.
Georgi Ganev, CEO of Kinnevik, commented:
“Kinnevik’s ambition is to be the go-to public company for investors seeking exposure to the best entrepreneurs building leading digital businesses in Europe, the Nordics and the U.S. After the distribution of our shareholding in Millicom, I believe our shareholders will benefit from Kinnevik having a higher share of its capital invested in unlisted, leading consumer businesses of tomorrow.
As part of our ambitions, we are today announcing an amended shareholder remuneration policy. Under this policy, we will cease to pay ordinary dividends in favor of re-investing the dividends we currently receive from Tele2 into our portfolio’s proven and high-performing companies on our shareholders’ behalf. We have a continued ambition to distribute meaningful cash returns, but going forward it will be in a more ad hoc manner as and when we release excess capital from our investments.
I look forward to describe our strategy at greater depth and to highlight a number of our emerging investee companies at our Capital Market’s Day on 19 September.”
This information is information that Kinnevik AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out below, at 13.00 CET on 17 September 2019.
For further information, visit www.kinnevik.com or contact:
Torun Litzén, Director Investor Relations
Phone +46 (0)70 762 00 50
Kinnevik is an industry focused investment company with an entrepreneurial spirit. Our purpose is to build digital businesses that provide more and better choice. We do this by working in partnership with talented founders and management teams to create, develop and invest in fast growing businesses in developed and emerging markets. We believe in delivering both shareholder and social value by building companies that contribute positively to society. Kinnevik was founded in 1936 by the Stenbeck, Klingspor and von Horn families. Kinnevik’s shares are listed on Nasdaq Stockholm’s list for large cap companies under the ticker codes KINV A and KINV B.