EQT Gets About 5 Bids From EUR2 Billion-EUR2.5 Billion For KabelBW - Sources
February 17 2011 - 1:57PM
Dow Jones News
Swedish private equity firm EQT has received about five bids in
the range of EUR2 billion to EUR2.5 billion on its auction of
German cable operator Kabel Baden-Wuerttemberg, three people close
to the process said Thursday, in a potential disappointment to EQT
on price.
The bidders include U.S. media conglomerate Liberty Global Inc.
(LBTYA), and private equity firms CVC Capital Partners, Cinven
Group, Providence Equity Partners and Hellman & Friedman, the
people said.
EQT will evaluate the bids over the next couple of weeks and
then decide if it should pursue with a sale or an initial public
offering, one person said. Providence Equity, owner of Germany
largest cable provider, Kabel Deutschland AG (KDG.XE), last year
opted for a EUR760 million IPO valuing KDG at just under EUR5
billion, despite having previously received higher private offers.
Providence later sold more shares in KDG and now holds about
44%.
People familiar with the matter said Providence Equity's bid
might be complicated by its KDG stake, and Liberty Media is also
expected to face anti-trust concerns because of its ownership of
Unitymedia, Germany's second-largest cable operator by subscribers.
KDG, KBW and Unitymedia had tried to merge in 2004 but were
thwarted by regulators.
EQT, the private equity arm of Sweden's Wallenberg family,
launched the sales process for Germany's third biggest cable
operator last year, lining up banks in preparation of either an
initial public offering or outright sale.
A person familiar with the matter earlier said the bidders would
have to put up at least nine times Kabel BW's earnings before
interest, taxes, depreciation and amortization, or EUR2.88 billion
given Kabel BW's 2010 Ebitda of EUR320 million, to be recognized by
the vendor. Another person said EQT was hoping for bids closer to
EUR3 billion.
EQT acquired the Heidelberg-based provider of cable TV, Internet
and telephone services from U.S. investment group Blackstone Group
LP (BLX) for around EUR1.3 billion in 2006 and has invested more
than EUR800 million in network expansion.
JPMorgan Chase & Co. (JPM) and Deutsche Bank AG (DB) are
serving as advisors to EQT in the process.
Kabel BW declined to comment on the process.
-By Anna Molin and Margot Patrick, Dow Jones Newswires; +46 8
545 131 03; anna.molin@dowjones.com
(Carol Dean in London and Philipp Grontzki in Frankfurt
contributed to this article.)
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