Private equity duo purchase almost half of Euskaltel shares

9 Oct 2012

A pair of private equity groups has reportedly acquired almost half of the shares in alternative Spanish cableco Euskaltel, according to Reuters. Investindustrial, a buyouts group backed by Italy’s Bonomi family, and former Lehman Brothers private equity arm Trilantic Capital Partners have jointly purchased a 48% holding in the operator. While the full financial details of the transaction have not been publically disclosed, the private equity firms have said that the acquisition cost in excess of EUR200 million (USD261 million). As part of the deal Kutxabank, a Basque region savings bank, reportedly sold a 10% stake to the two buyers, retaining a 49.9% holding in Euskaltel, with the financial institution cited as saying that the entry of new shareholders was driven by accounting and regulatory issues after its merger with two other lenders – BBK and Vital – meant it owned 68% of the cableco. A number of other Basque government-related groups, meanwhile, jointly divested a 19% stake under the terms of the deal, and Spanish utility company Iberdrola sold 8% (leaving it with a 2% holding). Rounding out the sellers, powerco Endesa and solar panel maker Mondrago parted with 9% and 2% stakes respectively. In the wake of the deal, Investindustrial is understood to have claimed that Euskaltel has the potential to increase its profitability.

As noted in TeleGeography’s GlobalComms Database, Derio-based Euskaltel is the largest alternative provider of fixed line telecoms services in the autonomous Basque region of northern Spain. At the end of June 2012 it had 238,100 broadband subscribers, the bulk of which (231,200) were carried over its hybrid fibre coaxial (HFC) network. The operator also provides mobile voice services via a mobile virtual network operator (MVNO) agreement with Vodafone Spain.

Spain, Euskaltel Group (incl. R Cable and Telecable)