John Malone’s international cable operator Liberty Global moved closer to domination in the land of Hans Brinker and wooden footwear Friday, receiving approval from the European Commission that helps pave the way toward completion of its planned acquisition of Dutch cable company Ziggo.
“We are pleased that the European Commission has approved our pending acquisition of Ziggo, which will benefit consumers and businesses across the Netherlands given our commitment to investment and innovation in the Dutch market,” Liberty Global CEO Mike Fries said in a statement. “We are excited to create a national cable champion, and look forward to restarting our share buyback program very soon."
Liberty Global, which already owns a 28.7% interest in Ziggo, announced in January its plan to acquire the rest of the company for about $13.7 billion. With the addition of Ziggo’s 2.7 million subscribers, Liberty Global – which already has about 3.7 million Dutch cable customers through its UPC Netherlands unit – would reach about 90% of homes in the country. According to the Commisson, the combined company would control between 60% and 70% of pay TV subscribers in the Netherlands.
“The approval from the European Commission is an important milestone in the process of combining two individual cable companies into a strong national provider for Dutch consumers,” Ziggo supervisory board chairman Andrew Sukawaty said in a statement. “Both the Management and Supervisory Board have unanimously recommended the offer to shareholders as we believe it is in the best interests of Ziggo and its stakeholders, including shareholders.”
To help with approval of the deal, Liberty Global agreed to divest of its Film1 premium pay TV channel and to terminate clauses in its carriage contracts with content companies that limit their ability to offer programming over the Internet. Liberty Global also agreed not to include such clauses in any of its carriage agreements with programmers for eight years.
"The commitments offered by Liberty Global ensure that the acquisition of Ziggo will not be detrimental to Dutch consumers, who will continue to enjoy the benefits of innovative services and choice for watching audio visual content,” Commission vice president in charge of competition policy Joaquín Almunia said in a statement.
Liberty Global expects the deal to be closed by next month.