Providence-backed KDG raises €760m

Germany’s largest cable television operator has gone public in the largest IPO in Germany since 2007.

Providence Equity Partners has shown that initial public offerings are still a viable exit route for private equity firms in Europe.

The firm successfully floated its portfolio company Kabel Deutschland, Germany’s largest cable television operator on Monday. The company raised €760 million in its IPO, debuting at €22 a share. Shares traded as high as €22.83 per share on Monday.

The IPO was Germany’s largest since 2007, the company said in a statement. The proceeds of the IPO will go directly to shareholders, including Providence, Teachers' Private Capital and the company’s management, the company said.

Kabel offered a total of 34.5 million shares. Providence, which first invested in Kabel in 2003, acquired its majority stake of about 88 percent in 2006 from Apax and Goldman Sachs Capital Partners. Apax and Goldman bought Kabel Deutschland from Deutsche Telekom in March 2003 for €1.7 billion.

Kabel provides cable services to 15 million homes in Germany.

Kabel was one of several “dual-track” exits being closely watched in Europe recently. The other dual track exits – like Bridgepoint's £955 million sale of Pets at Home to Kohlberg Kravis Roberts – resolved in straight sales. Reportedly, CVC Capital Partners and The Carlyle Group were ready to bid €5 billion on the company. Advent International, Apax and BC Partners were also reportedly interested in bidding.

Other private equity firms have not had such luck trying to take their companies public in Europe. Budget fashion retailer New Look, owned by Permira and Apax, pulled its IPO in February. The Blackstone Group delayed IPOs on its portfolio companies Merlin Entertainment and Travelport earlier this year as well, due to volatile markets.