Kabel Deutschland, Germany’s largest cable operator, has agreed to buy regional provider Tele Columbus for about €618m as it targets underserved markets for its fast internet and premium television services.
Tele Columbus provides basic cable services to approximately 1.7m customers in 2.1m homes, predominantly in Berlin and other cities in eastern Germany, including Dresden, Magdeburg and Potsdam.
The purchase, which includes about €600m in debt, is subject to review by German competition regulators.
If approved, it would allow Kabel Deutschland to tap new customers for products such as video on demand and high-speed internet. Tele Columbus reported revenues of €218m in fiscal 2011.
“The business of Tele Columbus overlaps to a large extent with Kabel Deutschland’s footprint,” Kabel Deutschland said on Monday.
“Following a successful closing of the acquisition, most of Tele Columbus’ customers will be able for the first time to subscribe to Kabel Deutschland’s high speed internet products and new TV services.“
The purchase price amounts to €603m plus accrued interest, bringing the total price to €618m as of the end of 2011.
Kabel Deutschland said the acquisition, if successful, would generate 1 per cent in additional top-line revenue growth. The company expects the deal, which must be approved by Germany’s Federal Cartel Office, to close in the first quarter of 2013.