Vodafone Group has increased its preliminary offer for Germany’s largest cable operator Kabel Deutschland to around EUR7.5 billion (USD10 billion), according to Bloomberg, citing people familiar with the matter. Last week Kabel Deutschland rejected an initial bid of around EUR80-EUR82 per share from the British company, but the unnamed sources say that Vodafone has now told the cableco that it would be willing to pay EUR85 a share. The people added that Vodafone is now in discussions with Kabel Deutschland and studying its books ahead of presenting an official offer in the coming weeks. The British group had put preliminary plans to acquire Kabel Deutschland on hold in the first quarter of this year after they surfaced in the press, but earlier this month it was reported that it was taking another look at a potential bid for the cableco, in a move that would bolster its position in the German fixed line market.
The new offer follows confirmation from Kabel Deutschland on Monday that it had received a preliminary approach from Liberty Global, potentially starting a bidding war between the US firm and Vodafone Group. While the German cableco, which has a network serving around 8.5 million households in 13 out of 16 states, did not provide any further details on the preliminary offer, it was reported that Liberty offered around EUR85 per share. According to the Financial Times, the US media group controlled by John Malone has proposed to inject its existing German cable assets and keep Kabel Deutschland’s public listing, in a bid to overcome potential regulatory hurdles. Liberty Global already owns the country’s second largest cableco, Unitymedia KabelBW, which was formed last year from the consolidation of Unitymedia and Kabel BW; the US firm had originally purchased the two companies in early 2010 and late 2011, respectively.