Financial Trio Nears Cable-TV Deal with Deutsche Telekom

29 January 2003

Deutsche Telekom is this week set to confirm the sale of its last six German cable television firms to a consortium of three financial bidders.

The telecoms giant has been trying to offload the units for over a year, and has struck an informal agreement with Providence Equity Partners, Apax Partners and Goldman Sachs.

Forecast to complete in March, the deal is said to be worth between €1.72 billion ($1.86bn; £1.14bn) and €1.75bn in cash upfront, plus a later earnings-related payment of up to €350 million. Each bidder will take one-third of the equity and pay around 30% of the total cost each, the remainder being funded by a loan from Morgan Stanley and Goldman Sachs.

Those figures are a far cry from the €5.5bn deal struck with US firm Liberty Media in late 2001 but foiled by regulators last February [WAMN: 14-Feb-02], and is also lower than Telekom’s €2bn–€2.3bn cash forecast in November. The debt-beset German group may make further asset disposals as a result.

Data sourced from: Financial Times; additional content by WARC staff