KDG drops Tele Columbus bid as regulator red flags
The German Federal Cartel Office has told Kabel Deutschland its assessment of the remedy package offered on January 22nd for the acquisition of TeleColumbus doesn’t go far enough. KDG says it will now drop the bid.
Kabel Deutschland had offered the disposal of Tele Columbus networks in the cities of Berlin, Dresden and Cottbus. The FCO, however, required the divestment of approximately 60 per cent of the Tele Columbus networks in Eastern Germany – twice as many as offered by Kabel Deutschland.
In a statement the Company said: “[it] regrets the Cartel Office’s assessment. Kabel Deutschland’s remedy offer was far reaching and went to the commercial limit. The envisaged transaction would have benefited infrastructure competition as well as consumers. As a result of the envisaged acquisition, over 900 thousand households in Eastern Germany would have obtained first-time access to high speed Internet over cable. In addition, Kabel Deutschland would have become active outside its current footprint by entering into competition for contracts with housing associations in North Rhine-Westphalia and Hesse.”
“Irrespective of the outcome on the Tele Columbus acquisition, Kabel Deutschland will continue to pursue its organic growth strategy focusing on Internet & Phone and Premium TV. The Company’s superior broadband infrastructure and products provide a unique basis for sustained growth over the coming years.”