Troubled German cableco KabelBW has completed its purchase of units in the Baden-Württemberg province from rival Tele Columbus.
In the deal, Kabel Baden-Wuerttemberg (Kabel BW), which is owned by Swedish based private equity firm EQT, will acquire…
Troubled German cableco KabelBW has completed its purchase of units in the Baden-Württemberg province from rival Tele Columbus.
In the deal, Kabel Baden-Wuerttemberg (Kabel BW), which is owned by Swedish based private equity firm EQT, will acquire numerous regional network assets in the German region of Baden Wuerttemberg from the debt-laden Tele Columbus. The assets have approximately 50,000 customers. Kabel BW had 2.3 million customers as at the end of 2009 and 2009 sales of E490m.
Tele Columbus’ creditors took control of the cableco late last year after soaring debts, and initially attempted to sell off the asset, but failed. Tele Columbus’ creditors include Bank of Ireland, York Capital and Alcentra.
According to local reports, those creditors have been given until the end of the day on May 20 to approve the proposed restructuring within Tele Columbus, which would see company debt cut from its present E947m to E623m.
Under the restructuring, the cable firm’s E283m mezzanine debt would be cut by 90%, its E75m of outstanding second-lien debt slashed by 60% and its E589m of senior debt reduced by 10%. In return, the mezzanine creditors would own 53% of the company’s equity, senior lenders 33% and second-lien lenders a 14% stake..
The proposed restructuring has allegedly already secured the backing of 90% of the company creditors, but needs 100% backing to go ahead.
Citigroup was believed to be advising the Tele Columbus creditors.
Last May, the two operators announced they had reached agreement on the sale of the local networks to KabelBW. After receiving the green light from the Bundeskartellamt, the sale has now been completed. No financial details about the deal have been made public.
As a result, KabelBW is now adding 43,000 homes to its fold in the cities of Reutlingen, Stuttgart, Karlsruhe, Schwäbisch Gmünd and Wertheim. In the coming months, KabelBW plan to roll outs its full product portfolio to the newly acquired customers.
