Cable MSO Liberty Global is seeking to acquire the shares and access to voting rights that it does not already own or that are not held by Belgian cable operator Telenet. It is intending to launch a voluntary and conditional cash offer for the outstanding shares and other securities giving access to voting rights.
Liberty Global has been the controlling shareholder in Telenet since February 2007 and currently owns, through its wholly owned subsidiary, Binan Investments B.V., 50.4 per cent of Telenet’s outstanding issued share capital (excluding treasury shares). The Intended Offer will be based on a price of €35.00 per ordinary share.
A price of €35.00 per ordinary share represents a premium of approximately 14 per cent over the adjusted average volume weighted closing price of approximately €30.67 for the one-month period to September 18, 2012 pro forma for the €3.25 capital reduction paid by Telenet on August 31, 2012.
Liberty Global’s Intended Offer will be subject to customary and normal conditions including (i) Liberty Global and its affiliates having acquired or holding, upon completion of the Intended Offer, at least 95 per cent of the outstanding Telenet shares and voting rights and (ii) no material adverse change having occurred with respect to the financial situation or prospects of Telenet and in the financial markets in general. The Intended Offer will possibly be followed by a delisting of Telenet and a squeeze-out offer.
Liberty Global has advised Telenet’s board members of its intentions. In respect of Telenet’s intended buyback offer as announced in Telenet’s press release dated August 13, 2012, Liberty Global refers to the press release of Telenet released on September 20, 2012 (Brussels time).
Libert Global has clarified that the announcement is not a formal binding tender offer under the Royal Decree of the Belgian Law dated April 1, 2007 on public take-over bids. Whether or not the Intended Offer will eventually be made as a formal binding offer depends on a number of conditions, including the outcome of the independent valuation commissioned by the independent board members in comparison to the proposed price per share, overall financial market conditions, any material business or financial developments at Telenet and Liberty Global’s ability to raise satisfactory financing.
If Liberty Global elects to proceed with a formal and binding offer, Liberty Global will file the required documentation, including the bid prospectus, with the Belgian Financial Services and Markets Authority as soon as possible. In the event that Liberty Global decides not to proceed with a formal offer, Liberty Global will immediately issue a further public announcement to that effect. In case of a formal and binding offer, Liberty Global plans to finance it by using available cash on its balance sheet and incremental borrowings.
The Intended Offer values all the outstanding voting securities of Telenet not currently owned by Liberty Global or held by Telenet at approximately €1.96 billion. No further regulatory approvals are required.
Mike Fries, President and Chief Executive Officer of Liberty Global, said it was the right time for Telenet to become a wholly-owned part of Liberty Global’s pan-European platform in its next stage of development, particularly in light of the competitive and regulatory outlook in Belgium. “We are proud of the success Telenet has achieved over the years and of the many innovations it has brought to Belgian consumers. As a long-term, industrial player in European cable, this shows our commitment to the Belgian market. Telenet is one of our most successful operations and a core part of our growing pan-European platform. We remain very supportive of the existing management team and employees at Telenet, all of whom have contributed to the company’s success. We will continue our focus on investments and product innovation in Belgium.”