KDG eyes smaller rivals

German cable network operator Kabel Deutschland (KDG) is looking at smaller rivals such as PrimaCom and Tele Columbus as potential acquisition targets, rather than bigger rival Kabel BW, the company’s chief executive, Adrian von Hammerstein, told Dow Jones Newswires. ‘As far as acquisitions are concerned, Kabel BW wouldn’t be at the top of the priority list at all,’ von Hammerstein said, adding: ‘There is a range of in-region consolidation possibilities with Tele Columbus and Primacom, which are just as interesting.’ The chief executive revealed that KDG has already held talks with smaller rivals in the last few months, although talks have not been successful due to differing views on the acquisition prices. According to TeleGeography’s GlobalComms Database, KDG has long expressed an interest in acquiring struggling rival Tele Columbus and PrimaCom. An attempt by KDG to take an 18.6% stake in PrimaCom was blocked in June 2007 by the Federal Cartel Office (FCO), which claimed it had not been officially notified of the deal. The purchase would have increased KDG’s holding in PrimaCom to 36.1%. Three months later, KDG agreed to tender its stake in PrimaCom to Orion Cable Group, in a deal which saw Orion selling certain network assets to KDG, including 1.2 million subscribers in eight federal states. Creditors of Tele Columbus took control over the indebted company in January 2010 after its parent Orion Cable sold the operation for EUR2.5 million (USD3.5 million), but in July 2010 KDG ended talks with Tele Columbus after deciding that it was not worth the EUR600 million its owners sought to raise.