Millicom International Cellular S.A. agreed to buy Entel Peru for about $1.71 billion including lease liabilities, pushing the Latin American carrier best known for its Tigo brand into a 34-million-person market it has never served.
The price works out to about five times Entel Peru’s estimated 2026 earnings before interest, taxes, depreciation and amortization, before any savings from combining operations. Millicom announced the agreement after the U.S. market closed on Friday. The deal also covers Americatel Peru, a smaller unit of the Chilean seller.
Paying over 18 months
Millicom will not hand over the full amount up front. It will pay 65% of the price at closing, 10% twelve months later and the remaining 25% eighteen months after closing. The company plans to cover the purchase with local financing and cash on hand, and it said leverage at the end of 2026 should hold at about 2.5 times even with the acquisition included.
The carrier said it expects the purchase to add to equity free cash flow in its first year and does not expect it to crimp planned payouts to shareholders. It described the deal as following the same playbook it used in a string of recent purchases of Telefonica businesses in the region.
Entel turns home
For Empresa Nacional de Telecomunicaciones, the sale marks a retreat to its home market. Entel Peru has a little more than 10 million customers, accounts for roughly a third of group revenue and has ranked as the second-largest operator in Peru by mobile service revenue since 2023. Entel said it would use much of the money to shore up its balance sheet and focus on Chile, and its board plans to propose a special dividend of 2,100 Chilean pesos a share that depends on the sale closing.
Entel shareholders are scheduled to vote on Nov. 30. The companies expect to complete the transaction in early December.
Why Peru
Millicom has been leaning toward countries with investment-grade credit ratings, and Peru carries them from all three major agencies. The buyer pointed to fast growth in fiber connections and in postpaid mobile plans as room to sell bundled home and mobile service. The acquisition would lift Millicom to 13 markets.
Millicom shares closed down about 1.9% in regular Friday trading, before the announcement, and changed little in after-hours trading.
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