John Malone-backed Liberty Global has offered to buy Cable & Wireless Communications for £3.6 billion (€5.1bn) to extend its reach in the Caribbean.
London-based Cable & Wireless describes itself as “the go-to player” in the Caribbean and Latin America. Malone, the US ‘King of Cable’, bought about 13 per cent in the company through a holding company in March. The stock offer for Cable & Wireless is valued at 78.04 pence per share, a premium of about 6 per cent to Cable & Wireless’s Monday close. Shareholders will also receive a special dividend of 3 pence per share.
Pivotal Research Group analyst Jeff Wlodarczak said the deal was valued at nine times EBITDA, adding that it was an "attractive price". Cable & Wireless offers home Internet, TV, landline and mobile phone, the so-called "quad play" package sought by companies such as Vodafone and Liberty.
Cable & Wireless had more than six million customers as of March, primarily in the Caribbean, Panama, Monaco and the Seychelles. The combined business would serve 10 million video, data, voice and mobile subscribers, Liberty Global’s chief executive Mike Fries said in a statement.
Liberty Global has been growing through acquisitions. It bought Ireland's TV3 television station earlier this year, Dutch cable operator Ziggo NV last year and British cable group Virgin Media in 2013. The Cable & Wireless deal comes nearly two months after Liberty Global and Vodafone ended talks regarding a swap of assets as they could not agree on valuations. The company raised its stake in ITV Plc to 9.9 per cent in July but squashed rumours of a takeover. Cable and Wireless said the Liberty Global offer values the company at about $8.2 billion, including debt.
Reuters
