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Liberty reaches settlement over Unitymedia KabelBW antitrust case

16 Feb 2015

Deutsche Telekom (DT) and NetCologne have withdrawn their objection to Liberty Global’s 2011 purchase of German cableco Kabel BW and its subsequent merger with the UK-based firm’s other local cable operator, Unitymedia. Reuters cites a regulatory filing with the United States Securities and Exchange Commission as saying that Liberty Global has agreed to pay DT and NetCologne an aggregate amount of EUR183.5 million (USD208.9 million). ‘We consider the payment as not material for an operation which has way outperformed expectations,’ Liberty Global’s chief executive Mike Fries is quoted as saying in a conference call with analysts. Liberty expects that legal proceedings will be formally terminated by the end of this quarter.

As previously reported by CommsUpdate, Liberty Global purchased Unitymedia in January 2010 for an enterprise value of EUR3.5 billion, before snapping up and Kabel BW from Swedish private equity firm EQT in March 2011 for EUR3.16 billion. After imposing a number of conditions on the deal, the Federal Cartel Office (FCO) approved the acquisition of Kabel BW in December 2011 and the merger was completed on 1 July 2012. However, in August 2013 the Higher Regional Court of Dusseldorf reversed the FCO’s decision to approve Liberty Global’s acquisition of Kabel BW, after hearing complaints from DT and NetCologne. The court ruled that the concessions imposed on the deal were not sufficient enough to compensate for the increase in dominance following the merger of Kabel BW with Unitymedia, and it ordered the FCO to re-examine the deal.

Germany, Deutsche Telekom (DT), Liberty Global, NetCologne, Unitymedia

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