Spanish cableco Telecable has been acquired by Zegona, an investment vehicle set up by Eamonn O’Hare and Robert Samuelson, two former Virgin Media executives, for EUR706 million (USD781 million), Reuters reports. The deal is the latest in a long line of notable transactions in the Spanish telecoms sector, following in the wake of Vodafone Group’s purchase of ONO, Orange Group acquiring Jazztel and most recently Euskaltel agreeing to buy R Cable earlier this week. With regards to this specific deal, O’Hare was cited as saying that it is being viewed as a strategic move which would give Telecable an opportunity to be involved in any further consolidation in the market.
Telecable is understood to currently have more than 162,000 residential and corporate customers, with the company reporting revenues of EUR131 million and core earnings of EUR63 million in 2014. With the cableco said to have registered revenue growth each year for the last five years, O’Hare has suggested its turnover and earnings will grow more rapidly, with there said to be plans to expand its product range into the business sector, while speeds will be boosted and a focus placed on the offering of multi-play services including mobile and pay-TV to existing customers.
Meanwhile, the deal represents the first acquisition for Zegona, which was set up to buy and run businesses in the European technology, media and telecoms sectors. Having agreed to acquire the operator from existing owners Carlyle Group and Liberbank, it is reportedly funding the purchase with a combination of GBP251 million (USD390 million) of new equity, backed by institutional investors, funds from Zegona’s recent float and a debt facility arranged by Goldman Sachs.