Liberty eyes German cabler

John Malone may add Kabel BW to empire

BERLIN — John Malone’s Liberty is reportedly eyeing Kabel Baden-Wuerttemberg, Germany’s third largest cable group.

Liberty is looking at the possibility of combining Kabel BW with its Unitymedia group, the country’s second-biggest cabler, Bloomberg reported, citing two unnamed sources with knowledge of the deliberations. Liberty acquired Unitymedia last year in a deal valued at $5 billion.

Such a move would be logical, according to industry watchers, since Unitymedia alone covers only 4.6 million customers in two of Germany’s 16 federal states, North Rhine-Westphalia and Hesse. Kabel BW would mean an additional 2.3 million customers for Liberty.

Goldman Sachs is said to be advising Liberty on the possible deal.

Private equity firm EQT Partners has reportedly lined up banks in preparation for a sale of Kabel BW, which is expected to go for some $2.6 billion.

Rising demand for pay TV channels and triple-play offerings that bundle TV, Internet and phone services are making cable companies in Germany especially interesting for investors: Kabel Deutschland, Germany’s largest cabler, has seen its shares rise more than 80% in the past nine months.

Malone had sought as early as 2001 to take over Germany’s entire cable system for some $5 billion from former owner Deutsche Telekom, but was blocked by the country’s antitrust watchdog.

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