German Cable Giant Opts for IPO


Kabel Deutschland, the
largest cable operator in Germany,
put an end to speculation
it would go on the block — and
possibly be snapped up by Liberty
Global chairman John Malone
— saying last week that it would
instead commence an initial public
offering of stock.

The announcement ends speculation
that cable legend Malone
would make another attempt to
consolidate the German market.
Malone had tried a similar tack in
2001, making moves to acquire the
cable assets of Deutsche Telekom,
but was blocked by regulators who
rejected the deal in 2002. Instead,
the German government split
Deutsche Telekom’s cable holdings
into three separate companies
— UnityMedia, Kabel BW and
Kabel Deutschland.

Speculation heated up that
Malone and others would make a
play for Kabel Deutschland, which
has about 9 million customers,
and Kabel BW (with 2.3 million
subscribers), after Liberty Global
agreed to acquire UnityMedia
for $5.2 billion. UnityMedia is the
second largest cable operator in
Germany, with about 4.5 million
customers. Liberty Global closed
on that deal in January. The deal
speculation heightened after reports
that Kabel Deutschland’s
largest owner — private-equity
giant Providence Equity Partners
— was entertaining off ers for the

According to reports, Kabel
Deutschland said it plans to launch
the IPO on the Frankfurt Stock Exchange,
but gave no further details
regarding timing or the amount of
shares to be off ered. Several privateequity
groups made off ers for the
company, those reports added —
estimates were between $6.8 billion
to $7.5 billion — but the offers
were considered too low.