Continuing its transatlantic buying spree, following its takeover of Virgin Media in the UK and acquisition of a 27.3 per cent stake in Charter Communications in the US, broadband cable MSO Liberty Global has acquired 25.3 million shares in Ziggo, the largest cable operator in the Netherlands from Barclays Capital Securities Limited at €25.00 per share, representing a total investment of approximately €632.5 million. As a result of this investment, Liberty Global owns 12.65 per cent of Ziggo, based on the shares outstanding as of December 31st 2012.
Liberty Global considers the acquisition of this minority stake in Ziggo as an attractive opportunity to make a strategic investment in a market where it already enjoys a sizeable presence through its UPC Netherlands subsidiary. It says the Purchase Price is also financially attractive given the stock’s approximate 7.4 per cent dividend yield, which is implied by Ziggo’s expectation that it will pay €370 million of dividends during 2013.
Liberty Global will fund the acquisition of Ziggo shares with a non-recourse margin loan and existing liquidity. As the transaction does not result in Liberty Global obtaining a controlling interest in Ziggo, no regulatory approvals are required.
Barclays was forced to disclose it had a 14.2 per cent stake in Ziggo to the Dutch market regulator on March 22 in accordance with local rules. It acquired the stake after agreeing to underwrite the sale of 40 million shares in Ziggo for €25.05 a share on behalf of Cinven and Warburg Pincus.