Bonkers Bargain: Zegona Communications (Updated)
We previously suggested that Zegona was a cheap, dividend yielding play on the improving performance and growth of a Spanish telecommunications group. The takeover of the latter now sees Zegona make a big cash return to its shareholders, delivering a swift 50% return in a few short months for our Bonkers Bargain. The Zegona management team is now on the hunt for another deal.
Zegona Communications (LON:ZEG) was established with the objective of acquiring businesses in the European telecommunications, media and technology sector applying a ‘Buy-Fix-Sell’ strategy. Its first acquisition in August 2105 was Telecable, a cable telecommunications operator in the Asturias region of Spain. In July 2017 Telecable was acquired by Euskaltel S.A. (LON:EKT),a larger Spanish-based communications group listed on the Madrid stock exchange. Zegona initially acquired a 15% stake in the Spanish listed group which it subsequently increased to 21.44%. Euskaltel provides high speed broadband, data-rich mobile, advanced TV and fixed communications services to residential and business customers under the Euskaltel, R…