SCHEDULE 13D/A: Atlas Investissement Secures $800M Equity Financing for Millicom Stake

Atlas Investissement, a major shareholder in Millicom International Cellular SA, has secured approximately $800 million in equity financing by pledging its common shares.

Summary

• Atlas Investissement SAS, along with Iliad Holding SAS, Maya SAS, and the Niel Family, has entered into four master agreements for prepaid forwards and equity swaps with BNP Paribas, Credit Agricole Corporate and Investment Bank, Natixis, and Societe Generale.
• The purpose of this equity financing transaction is to refinance a Senior Facilities Agreement and cover related transaction costs, with any excess cash allocated to working capital or repayment of intragroup loans.
• The total financing amounts to approximately USD 800 million, secured by pledges over the Common Shares of Millicom International Cellular S.A. held by Atlas Investissement.
• Atlas Investissement beneficially owns 70,470,018 Common Shares of Millicom, representing 42.2% of the 167,084,562 shares outstanding as of September 30, 2025.
• The transaction does not involve the purchase of any new Common Shares by Atlas Investissement or its counterparties.
• The initial maturity date for these transactions is the third anniversary of the transaction date (November 12, 2025), with potential extensions to the fourth and fifth anniversaries subject to lender consent.
• The reference price for the Prepaid Forward(1) is USD 47.84, based on the open price of Millicom shares on the Nasdaq Global Select Market as of November 10, 2025.

Sentiment

Score: 6

Explanation: The sentiment is moderately positive. While securing significant financing is a positive for Atlas Investissement's liquidity and debt management, the pledge of a substantial equity stake and the inherent risks of derivative instruments introduce a degree of caution. It's a strategic financial move rather than a direct operational win for Millicom.

Positives

• Atlas Investissement has successfully secured significant equity financing of approximately USD 800 million, providing liquidity for refinancing existing debt and general working capital.
• The financing structure, utilizing prepaid forwards and equity swaps, allows Atlas Investissement to maintain its beneficial ownership of Millicom shares while accessing capital.
• The ability to extend the maturity date to the fourth and fifth anniversaries provides flexibility in managing the financing obligations.

Negatives

• A substantial portion of Atlas Investissement's Millicom shares are pledged as security for this financing, increasing leverage and tying liquidity to Millicom's share performance.
• Mandatory early unwind events, such as the sale of pledged shares or certain special cash dividends, could force premature settlement of the financing.
• The complexity of the financial instruments (prepaid forwards and equity swaps) introduces various calculation and valuation risks, including market disruption events and extraordinary events.

Risks

• Events of Default: Failure to make payments or deliveries, incorrect representations, insolvency, or issues with security interests could lead to termination of all transactions.
• Change of Circumstances: New laws or regulations making transactions illegal, mergers/demergers causing substantial deterioration of a party's financial condition, or failure to clear transactions could trigger termination.
• Market Disruption Events: These could affect the determination of the Final Price or other valuation metrics, potentially impacting settlement amounts.
• Extraordinary Events: Tender offers, merger events, delisting, nationalization, or insolvency events related to Millicom could lead to adjustments or termination of the transactions.
• Liquidity Risk: In case of termination, the party responsible for calculation may incur liquidity costs or gains, affecting the final settlement amount.
• Collateral Risk: The pledged shares are subject to margin call mechanisms, meaning Atlas Investissement may need to provide additional collateral if the value of Millicom shares declines.
• Currency Risk: Transactions involve both USD and EUR, introducing foreign exchange rate fluctuations that could impact the value of the financing and settlement amounts.

Future Outlook

The financing has an initial maturity of three years, with options for extension up to five years, indicating a medium-term financial strategy for Atlas Investissement's stake in Millicom. The use of excess cash for working capital or intragroup loan repayment suggests a focus on internal financial management and stability for Atlas Investissement.

Industry Context

This transaction reflects a significant financial maneuver by a major shareholder in the telecommunications sector. Equity financing through derivatives like prepaid forwards and equity swaps is a common strategy for large investors to unlock liquidity from their holdings without divesting, especially in mature or capital-intensive industries like telecom. The refinancing of a Senior Facilities Agreement suggests ongoing debt management by Atlas Investissement, which is typical for investment vehicles holding substantial stakes in publicly traded companies.

Comparison to Industry Standards

• The use of FBF Master Agreements for forward financial instruments is a standard practice in European financial markets for OTC derivatives, comparable to ISDA Master Agreements used globally.
• Pledging a significant equity stake (42.2%) for financing is a common method for large shareholders to leverage their holdings, similar to how other major investors in telecom companies might secure funding against their strategic investments.
• The inclusion of margin call mechanisms and various termination events (e.g., market disruption, extraordinary events, LTV ratio triggers) aligns with standard risk management practices for equity-linked financing in the financial industry, ensuring lenders are protected against adverse market movements or company-specific events.

Corporate Governance

Related Party Transactions

• The Niel Family (Xavier Niel, Jules Niel, John Niel, Elisa Niel, Joseph Niel) is deemed to have shared beneficial ownership over the Common Shares held by Atlas Investissement, Iliad Holding, and Maya SAS, indicating a related party structure for the reporting persons.

Stakeholder Impact

• Shareholders of Millicom: The pledge of a significant block of shares (42.2%) as collateral by a major shareholder could introduce volatility if margin calls occur or if the financing is unwound, potentially leading to forced sales or changes in ownership structure. However, the transaction itself does not dilute existing shareholders.
• Atlas Investissement/Niel Family: Gains significant liquidity (USD 800M) for refinancing existing debt and working capital, but increases financial leverage and ties their liquidity to Millicom's share performance, with the risk of losing pledged shares under certain conditions.
• Lenders (BNP Paribas, Credit Agricole, Natixis, Societe Generale): Benefit from fees and interest from the financing, with Millicom shares serving as collateral, providing security for their exposure.

Next Steps

• Atlas Investissement may request extensions of the maturity date to the fourth and fifth anniversaries, subject to written consent from the financial institutions.
• Ongoing monitoring of Millicom's share price and LTV ratio will be required due to margin call mechanisms and potential mandatory early unwind events.
• Party B (Atlas Investissement) undertakes to inform Party A (the banks) of any event or circumstance constituting or likely to constitute a Mandatory Early Unwind Event related to special cash dividends.

Key Dates

Recommendation

This filing primarily concerns a financing arrangement for a major shareholder (Atlas Investissement) rather than a direct operational or strategic announcement from Millicom International Cellular SA. While the financing provides liquidity to Atlas Investissement and refinances existing debt, the pledge of a significant portion of Millicom shares introduces a layer of complexity and potential risk related to the shareholder's financial health and market movements. The transaction itself does not fundamentally alter Millicom's business operations or financial performance. Therefore, a 'hold' recommendation is appropriate, as existing investors should monitor the implications of this shareholder financing without immediate changes to their investment thesis in Millicom, while potential investors should consider the added financial leverage and associated risks of a major shareholder.

Keywords

Millicom International Cellular SA, Atlas Investissement, Equity Financing, Prepaid Forwards, Equity Swaps, Schedule 13D/A, Shareholder, Pledged Shares, Refinancing, Corporate Finance, Derivatives, Xavier Niel