Vodafone Buys European Cable Assets Of Liberty Global

An Indian man walks past the signboard

An Indian man walks past the signboard

An hour later, Vodafone Group Plc announced an 18.4 billion-euro bid to bulk up its European business with Liberty Global Plc assets, including Unitymedia, the second-largest cable network in Germany.

Vodafone's share price rose by 1% to 209.8p after announcing the long-expected deal with Liberty Global, chaired by USA billionaire John Malone, who is also the largest shareholder in the business.

"This transformative acquisition will create a significant supplier of converged telecoms services adding more competition within the Romanian market", said Murielle Lorilloux, CEO of Vodafone Romania. We are committed to accelerating and deepening investment in next generation mobile and fixed networks, building on Vodafone's track record of ensuring that customers benefit from the choice of a strong and sustainable challenger to dominant incumbent operators.

Unitymedia is the second-largest cable network, operating in the three of Germany's 16 states that Vodafone does not already cover.

After the deal's completion, Liberty is to maintain a European presence in Belgium, Britain, Ireland, Poland, Slovakia and Switzerland. With operation, Vodafone, which is strong in those regions in mobile telephony, acquires above all a large park of clients of fixed broadband and cable television now in hands of American Liberty.

The transaction is expected to close in 2019 subject to regulatory approval, but Vodafone is confident there will be no obstacles to overcome.

The deal targets the U.S. giant's operations in Romania, Germany, Czech Republic and Hungary.

The combined businesses will strengthen Vodafone's existing mobile operations in the Czech Republic, Hungary and Romania, reaching over 6.4 million homes and have 15.8 million mobile, 1.8 million broadband and 2.1 million TV customers.

"This is one of those moments", said Liberty Global CEO Mike Fries.

It will give Vodafone access to more than 54 million homes using fibre-optic broadband, providing it with the ability to sell its services to new customers, while driving efficiency savings by combining back-office and other functions. However Fries said, "Even together, Liberty Global and Vodafone, whose cable networks don't compete or overlap, will be half the size of the incumbent operator. It's time to alter market dynamics by unleashing greater investment and competition". This means that the combination of Vodafone Romania and UPC Romania will enable the customers of both companies to access a converged bundle of mobile, broadband, and TV, as well as enterprise services.

A break fee of 250 million euros will be payable to the British company, in certain circumstances, if the deal does not complete. Liberty Global, listed in NY, fell 5.4% on Tuesday.

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