PE firms take full control of KB-W

Deutsche Telekom has sold its remaining 40 per cent stake in Kabel Baden-Wuerttemberg, a German cable company, to a consortium led by Blackstone Group.

German telecoms group Deutsche Telekom has sold its remaining 40 per cent stake in cable television business Kabel Baden-Wuerttemberg to the consortium which acquired a 60 per cent stake in the business in September 2001.

 

The consortium, which comprises The Blackstone Group, CDP Capital Partners, Bank of America Equity Partners and Cable Partners (formerly Callahan Associates), paid around E900m for the 60 per cent stake it acquired just under two years ago. Deutsche Telekom has declined to confirm the value of today’s transaction.

 

Dow Jones News reports that the sale price for the remaining stake would have been significantly lower, according to analysts, although a spokesperson for the German telecom operator said the stake was sold ‘at market prices’.

 

The Baden-Württemberg region is the third largest regional cable operation to be sold by Deutsche Telekom, with 4.7m franchise homes, 3.2m homes and businesses passed and 2.2m homes connected.

 

Valuations in the European cable market have fallen significantly since the peak of the technology boom in 2000.

 

In January, Deutsche Telekom’s sold a significant stake of its remaining cable TV interests to a consortium of Apax Partners, Providence Equity Partners and Goldman Sachs Private Equity. At E1.7bn, the value of this transaction was significantly below the E5.5bn US investor Liberty Media had offered for the same assets in 2001. The Liberty offer was rejected by the German competition authorities last year, by which time valuations in the sector had plummeted.