Proxy adviser ISS is recommending that shareholders of Sunrise reject the proposal for a capital increase to finance the takeover of UPC Switzerland at the next Extraordinary General Meeting on 23 October, Reuters reports, citing a report sent to clients.
ISS noted in the document that the “fair value” of UPC ranges from CHF 4.6 to 5.2 billion, making the current valuation of CHF 6.3 billion excessive. Moreover, Sunrise is overpayings “for assets in a transaction that appears to have debatable long-term strategic merit”, ISS added. A spokeswoman for Sunrise said that the company is examining the details of the ISS recommendation.
The firm, meanwhile, welcomed the recommendation of proxy advisor Inrate to approve the capital increase and remove chairman of the board of directors Peter Kurer and the board member and chairman of the audit committee, Jesper Ovesen.
Opposition to the deal has gained traction, with at least 30 percent of voting rights among shareholders, making the results of the vote at the EGM meeting still uncertain.
