Liberty to invest $7.2 billion in Germany thru 2010
Still claiming it is making no concessions to Germany's cartel office, Liberty Media Corp. said it would invest $7.2 billion in Germany through 2010, Bloomberg reports.
The cartel had sent Liberty a formal statement of objections to the company's proposed $4.76 billion purchase of six regional cable TV stations from Deutsche Telekom. The objections in part want Liberty to invest billions in upgrades in DT's local phone and broadband data services market before it would approve the purchase.
Late Friday, Liberty reiterated it would make no concessions and would stick with its original business plan.
But a Liberty attorney told reporters at a Frankfurt airport press conference that the company would invest $7.2 billion during the next several years, something that analysts say should more than satisfy the cartel's demands, Bloomberg reports.
Liberty has been angling to buy the six regional companies for $4.76 billion. The cartel's statement of objections reportedly questions Liberty's ability to own both the network and last-mile access, and suggested Liberty compete in DT's local phone and broadband data services market, a move that would take billions in upgrades.
In a statement issued late Friday, Liberty said its business model has worked around the world and approval of its original acquisition is "the most likely path to establishing a robust, long-term competitor in the markets for high-speed data, voice telephony and video content." Liberty also disagreed with the cartel's analysis and conclusions in its objections.
Last week, Liberty's John Malone told The Wall Street Journal the company had no intention of meeting the regulatory demands.
In the Friday statement, Liberty President and CEO Robert Bennett defended the company's business model and market approach.
"We believe the consolidation of Level 3 and Level 4 operators, the transformation of the market from a transport model to a market in which the cable operator is the retailer of services to the customer and the ability to efficiently and prudently develop a telephony business, among other things, are fundamental to the success of our long-term strategy," he says. The model has worked throughout Europe, he noted, and "is not a guarantee of success, but it is the only basis on which we can justify an investment of the capital of shareholders and bondholders."