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PrimaCom on the brink of insolvency

2 Jun 2010

German cable operator PrimaCom has announced it is facing insolvency after its creditors asked for EUR29.2 million (USD35.7 million) to be repaid. On 31 May the company’s shareholders failed to meet a deadline to react to a proposal from the creditors, which resulted in the latter demanding immediate repayment of outstanding bills. The cableco has now been given until 4pm on Thursday 3 June to repay the funds; if it fails to do so, or cannot come to an agreement with its creditors regarding the debt, the board of PrimaCom will be forced to register for insolvency. The firm’s creditors and major shareholders have been negotiating the restructuring of the debt and credit position of PrimaCom since April. PrimaCom has stressed that the day-to-day running of the cable business is not affected.

Meanwhile, German cable network operator Kabel Deutschland (KDG) has said it is interested in buying assets from PrimaCom. A spokesperson for KDG told Dow Jones Newswires that the struggling operator has 700,000 to 800,000 customers in the area where KDG operates. The acquisition would allow KDG to increase its direct (also known as level 4) relationship with its customer base and upgrade subscribers to new services such as broadband internet and fixed line telephony to boost revenue.

Germany, Kabel Deutschland, PrimaCom

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