MUMBAI: Germany‘s largest cable-TV platform, Kabel Deutschland, is set to be taken over by mobile telco giant Vodafone in a deal worth € 7.7 billion ($10.1 billion).
[Click and drag to move] Liberty Global, which owns Germany‘s Unity Media, had also been eyeing KDG, which has about 7.6 million TV subscribers in Germany. The transaction values KDG at € 87 per share. Its combination with Vodafone, which has 32.4 million mobile customers in the country, will create a company with € 11.5 billion in German revenues.
Vodafone predicts a strong growth potential for KDG, particularly with multi-service bundles-existing Vodafone customers can be cross-sold KDG‘s broadband, fixed telephony and TV offerings, while KDG subs can be cross-sold Vodafone‘s mobile offerings.
"German consumer and business demand for fast broadband and data services continues to grow substantially as customers increasingly access TV, fixed and mobile broadband services from multiple devices in the home and [Click and drag to move] workplace and on the move," said Vodafone CEO Vittorio Colao. "The combination of Vodafone Germany and Kabel Deutschland will greatly enhance our offerings in response to those needs and is consistent with Vodafone‘s broader strategy of providing unified communications services. The transaction announced today-which the management and supervisory boards of Kabel Deutschland intend to recommend to their shareholders-will lead to the creation of an operator with significant competitive scale, attractive operating and capital investment efficiencies and a combined management team with expertise across all communications segments and technologies."
Following the transaction, KDG management will be responsible for the combined consumer fixed-line business throughout Germany and for creating the single product platforms for TV, broadband and fixed telephony, out of the existing headquarters in Unterföhring. The platform‘s CEO Adrian V Hammerstein, will be invited to join the management board of Vodafone Germany.
Hammerstein commented, "Kabel Deutschland has evolved into one of the most dynamic players in the sector. Its high-performance infrastructure and successful strategy makes it ideally placed to continue returning above-average growth in a rapidly changing market. Kabel Deutschland and Vodafone are an ideal fit. Together, we have the opportunity to become Germany‘s leading telecommunications and television provider and to create what for the German market is a unique, winning combination of fixed line and mobile communications."
