PrimaCom’s owners step up sale plans

28 May 2012

Following on from the sale of regional operator Tele Columbus to cableco Kabel Deutschland earlier this month, Reuters cites two people familiar with the matter as saying that the owners of PrimaCom are accelerating efforts to sell the Leipzig-based company. According to the sources, information packets have been sent to a small group of potential bidders, while indicative bids are expected over the next few months. One of the people said that PrimaCom was expected to draw bids from the companies that showed interest in Tele Columbus, namely Kabel Deutschland, Deutsche Telekom and Unitymedia, although Kabel Deutschland’s chief executive Adrian von Hammerstein told Reuters that his firm would not take part in the bidding. PrimaCom’s owners, which hope to sell the cableco for at least EUR400 million (USD501 million), have hired investment bank Jefferies Group to advise on the sale.

At the end of 2011 PrimaCom served over one million cable subscribers in small to medium-sized cities in 15 states, predominantly Berlin, Brandenburg, Saxony, Saxony-Anhalt, Thuringia and Mecklenburg-Vorpommern. TeleGeography’s GlobalComms Database states that the firm’s lenders agreed to take over the company in a debt-for-equity swap in November 2010. In exchange for writing down PrimaCom’s loans, the creditors – US-based hedge fund Tennenbaum Capital Partners, Avenue Capital Group, ING and London-based Alcentra Group – acquired all of the shares in holding company Medfort Sarl, which bought PrimaCom from former parent PrimaCom AG in July 2010 after the company filed for insolvency. PrimaCom’s current debt stands at around EUR350 million.

Germany, PrimaCom