Vodafone agrees to buy Kabel Deutschland

24th Jun 2013 06:42

Vodafone has confirmed its intention to buy Germany's biggest cable company Kabel Deutschland.In one of the biggest deals the telecoms industry has seen since the height of the technology boom, Vodafone said the agreement would deliver shareholders €87 per share in cash. It would value the entire fully diluted ordinary share capital of Kabel at €7.7bn.The announcement came as no surprise as it followed various reports of a deal and talks between the two companies. The companies met on Sunday to clinch a deal after an informal offer was made by Vodafone two weeks ago.However, Vodafone's takeover of Kabel may set off a bidding war by Liberty Global which has also lodged an informal bid of €85 a share for Kabel. But competition regulators may block a consolidation between two of Germany's major players in the industry.Vodafone said the transaction will be implemented as a voluntary public tender offer by its wholly-owned subsidiary Vodafone Vierte Verwaltungsgesellschaft mbH for €84.50 per share in cash plus the payment of the €2.50 dividend, announced by Kabel on February 20th.Kabel plans to recommend the deal to shareholders and the board intends to accept the offer. The combination of Vodafone and Kabel will create an integrated communications operator, with €11.5bn of pro forma revenues in Germany.Following completion of the transaction, Vodafone will have 32.4m mobile, 5.0m broadband and 7.6m direct TV customers in Germany.RD