Kabel Deutschland acquires Tele Columbus
Kabel Deutschland has has confirmed that it is to acquire fellow German cable MSO Tele Columbus. The purchase price amounts to €603 million plus accrued interest. As of December 31, 2011, this would have been equivalent to €618 million. The purchase price will provide for repayment in full of the financial debt of Tele Columbus.
Tele Columbus, headquartered in Berlin, provides basic cable services to approximately 1.7 million customers in 2.1 million homes connected and is Germany’s largest network level 4 cable operator. The company operates predominantly in Berlin and in Eastern Germany including the cities of Dresden, Magdeburg and Potsdam. The business of Tele Columbus overlaps to a large extent with Kabel Deutschland’s footprint. In the fiscal year 2011 Tele Columbus reported revenues of €218 million and an operating result (EBITDA) of €81 million.
The transaction resolves to a large extent the separation of cable network levels as is already the case in the footprints of Unitymedia in North Rhine-Westfalia and Hesse and of Kabel BW in Baden-Wuerttemberg. Following a successful closing of the acquisition, most of Tele Columbus’s customers will be able for the first time to subscribe to Kabel Deutschland’s high speed Internet products and new TV services. Kabel Deutschland suggest the transaction will strengthen the existing broadband infrastructure competition in Germany.
Tele Columbus had been in the hands of more than 100 international creditors who acquired the company which fell several hundreds of millions euros in debt during 2010. A number of rival bidders had been suggested, including Deutsch Telekom, Liberty Media and investment houses.