Salt shakes off IPO plan

The arrival of autumn was reportedly to be accompanied by a flotation of Switzerland’s Salt this year, but now it seems the plan is off, at least for now.

Xavier Niel, owner of the Swiss telco and other European telecoms assets, has mothballed his proposed IPO, unnamed sources cited by Bloomberg said, without giving a reason for the move. However, the flotation could still happen at a later date, they said.

This is a particularly busy time for European listings, with investors flocking to high-growth stocks, the newswire noted. Which perhaps suggests that Salt owner Xavier Niel believes there is a better way to monetise the investment he made in the Swiss telecoms market six and a half years ago. Bloomberg received an “exploring all options for financing the next stage of its development and growth” comment, which doesn’t tell us a lot.

But Salt has never said a lot. In fact, the company never confirmed its widely reported IPO plans.

News of the flotation came from Reuters in June, whose sources claimed knowledge of a proposed autumn listing in Zurich that would value the operator at 2.5 billion Swiss francs ($2.7 billion).

Interestingly, that’s less than the 2.8 billion francs Niel paid Apax Partners for Salt, then operating as Orange Switzerland, in 2015. However, the telco has sold off a portfolio of telecoms towers in the interim, and been through something of a streamlining process.

Reuters said Niel was now looking for a way out and planned to sell around CHF700 million worth of mainly new shares, and listed four big name financial firms that it said were organising the float. It seemed like a done deal, particularly as Salt itself indicated that an IPO could be one of the financing options it had in front of it.

All of which raises the question of what Salt will do now.

The possibility of a listing is not off the table, and Niel doubtless has a number of alternatives to consider. But at an operational level, the company is in a slightly risky position in the Swiss market, having been left out in the cold – to an extent – when Liberty Global merged its UPC Switzerland business with rival Sunrise last year.

However, since then the telco has brokered a partnership deal with Swisscom that will see it invest in the incumbent’s fibre-to-the-home (FTTH) network, in exchange for the right to use it. It also posted a decent set of Q2 numbers a month ago, reporting growth in both revenues and earnings.

It may be lacking in scale, but Salt looks to be in decent shape. And if anyone can hammer out the right deal for financing its operations going forward, IPO or otherwise, it’s probably Xavier Niel.


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