FRANKIFURT, DÜSSELDORF. The financial investor Providence staged a battle for cable bidders Germany (KDG). The U.S. private equity house would sell Germany’s largest cable company as quickly as possible, it was said yesterday in financial circles. The list of interested parties is therefore long: In addition to financial investors KKR, Bain, TPG, CVC, Apax, Cinven, BC Partners and Apollo also examined the Deutsche Telekom Group Vodafone and media entrepreneur John Malone, a takeover.
In financial circles it is considered very likely that is a minimum of two financial investors in a bidding consortium. Alone, they could not lift the standing in the room price of around five billion euros. This would correspond to the last eight times earnings before interest, taxes, depreciation and amortization of KDG.
Since months, there is market speculation about a sale of the German market leader. Parallel Ownership Providence prepares for an IPO this year. "The IPO seems to be the more expedient," it said in financial circles. KDG declined to comment, Providence was not reachable for comment.
Skilled PR will drive the price
In the industry, the horse-trading is being closely monitored by KDG. "Through clever PR is currently trying to drive the price upward," said Hans-Peter Labonte, vice-chairman of the trade association receiving broadcasts and cable systems. Providence is going on in the case of KDG as the two financial investors, Apollo and BC Partners, formerly with Unity Media, the second largest cable company in Germany. The tandem also had originally planned an IPO. At the last minute sold by the two private equity firms, the Cologne-based company but for 3.5 billion euros at the cable company Liberty Global by John Malone.
The sale of KDG, but it is still early. An examination of the books have not yet been reported financial circles. Clearly, however, a consortium of banks willing to provide for the business a "staple" financing. This is a loan package arranged by the seller and would be available to every equity investor in small extra charge. Apparently, the banks are willing to provide a loan package with a volume of 5.5-times the Ebitda disposal.
A sale to John Malone is considered unlikely, since this is after the acquisition Unitymedia already heavily represented on the German market. "The antitrust impossible," said Labonte. The Competition Authority is currently no nation wants cable providers.
The industry is also constantly Vodafone called. Whether slamming the mobile phone giant, is open. "Vodafone has not made a decision whether it wants to make such an investment at all," said an insider. Vodafone would not comment on the speculation. Already on the sale of Unity Media, the group had shown interest, had shrunk in the end but before the high price.
KDG currently supplies about nine million households in 13 provinces. Business with monthly fees is estimated by the financial investors, as it is relatively non-cyclical. In contrast, the advertising revenues of television companies are very volatile.
Besides KDG, Kabel BW will also be sold if an attractive price is offered. The company is owned by the Swedish financial investor EQT. In addition, the medium offered Tele Columbus. The fourth-largest cable company was recently sold to a consortium of some 100 creditors. Now he is financially restructured once.