Liberty buys Deutsche Telekom cable systems
Liberty Media will buy six of nine regional cable TV regions from Deutsche Telekom AG for an estimated $4.7 billion. The deal follows a February letter of intent between the two, but with revisions.
Under the deal, Liberty will acquire cable systems in Hamburg/Schleswig-Holstein/Mecklenburg-Vopommern, Bremen/Niedersachsen, Rheinland-Pfalz/Saarland, Berlin/Brandenburg, Sachsen/Sachsen-Anhalt/Thuringen and Bayern. The regions entail more than 10 million homes.
Liberty also will acquire the "activities of Deutsche Telekom Kabel-Services GmbH (DeTeKS) and MediaServices GmbH (MSG)," DT reports.
Likewise, Klesch & Co. Ltd. in London, part of a consortium Liberty led on the first deal, will have an option to acquire a 24.9 percent interest in the deal.
The present deal gives DT cash toward its $49 billion debt and Liberty a chance to expand its European market. In February, Liberty announced a $1.4 billion investment in UnitedGlobalCom Inc.
In February, Liberty had announced that it organized a partnership with Klesch and the two had signed a letter of intent to purchase 55 percent of the properties, with an option for an additional 20 percent of the equity interests. Observers say it was easier for Liberty to simply purchase the properties outright. The new deal also prevents Klesch from having a competitor as a shareholder.
The two plan a final agreement in July, and a completion following approval from antitrust agencies.