The Deal: Ziggo Enters New Round of Takeover Talks With Liberty
NEW YORK (The Deal) -- Dutch cable company Ziggo (ZIGGF) on Thursday said it had entered talks to be bought by minority investor Liberty Global (LBTYA) two months after rejecting an earlier approach from the Englewood, Colo.-based cable company.
"There is no certainty that any agreement can be reached," Ziggo said in the three-sentence statement.
Ziggo shares jumped 7.1%, or 2.18, to 33.03 in Amsterdam following the announcement. The increase values the company at 6.6 billion ($9.1 billion).
Liberty bought a 28.5% Ziggo stake earlier this year after former owners Warburg Pincus and Cinven listed it last year.Liberty, the international arm of cable magnate John Malone's empire, has been a key player in a rework of Europe's cable and phone markets. The investor is hoping to cash in on the convergence of phone, TV and Internet services to boost sales in existing markets. Analysts have said Ziggo would be a good fit for Liberty's Dutch UPC cable company. Ziggo will also get a new CEO in January: outgoing Deutsche Telekom AG head Rene Obermann. In addition to Ziggo, Liberty also tried to take its Telenet Group Holding Belgian cable provider private but was thwarted by skeptical investors. Its 1.96 billion offer fell short of expectations but allowed Liberty to increase its 50.4% stake to 58.4%. Liberty executives have since said they're still interested in taking Telenet private at some point. In June, it completed the $23.3 billion purchase of the U.K.'s Virgin Media Inc. Liberty last year acquired German regional cable provider Kabel BW for 3.16 billion to fold into its Unitymedia German cable business. It also tried to reel in Unitymedia rival Tele Columbus but regulators feared that would harm competition and halted the deal. The company also wanted to buy yet another German cable company, Kabel Deutschland Holding, but was outflanked by cellular giant Vodafone Group (VOD). Vodafone bought Kabel Deutschland for 7.7 billion, highlighting the ongoing competition for European cable and phone assets. -- Written by Andrew Bulkeley in New York
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