German cableco Tele Columbus has announced plans to raise at least €300m (US$378m) by selling existing equity and issuing new shares in an initial public offering before the end of the year.
The country’s third-largest cable operator will use the…
German cableco Tele Columbus has announced plans to raise at least €300m (US$378m) by selling existing equity and issuing new shares in an initial public offering before the end of the year.
The country’s third-largest cable operator will use the proceeds to cut its debt and is planning a refinancing in connection with the flotation which will reduce its leverage to around 3.5x normalised LTM EBITDA.
Tele Columbus, owned by several hedge and credit funds via a Luxembourg-based holdco, mandated Goldman Sachs and JP Morgan at the start of the summer to work on a listing.
Today Tele Columbus’ management was bullish about the company’s growth prospects. Ronny Verhelst, the cableco’s CEO, said: “The significant growth potential of Tele Columbus is based on one of the best performing cable networks in the German market and a very attractive customer base with significant potential for selling additional products and services beyond cable TV services.
“This puts us in an excellent position to further grow our business over the coming years in one of Europe’s most attractive cable markets.”
British telco Vodafone acquired Tele Columbus’s larger rival Kabel Deutschland for an enterprise value equivalent to 11.9x its EBITDA in 2013. Meanwhile, Liberty Global’s recent acquisition of Ziggo valued it at 11.3x EBITDA, and Vodafone’s purchase of Spanish cableco Ono equated to around 10.5x.
Hanover-based Tele Columbus has not indicated how much of its stock will be listed or whether some of its current investors will take the opportunity to exit.
In addition to Goldman Sachs and JP Morgan, which are acting as joint global bookrunners, BofA Merrill Lynch and Berenberg are listed as joint bookrunners and Rothschild is Tele Columbus’s financial adviser.
Tele Columbus is an integrated level 3/level 4 operator and claims to have 1.7 million connected households as of the end of June. It offers cable television, broadband and telephony, and recorded €207.7m in revenue for 2013 and €89.6m EBITDA.
In 2013, Germany’s largest cableco KDG, now owned by Vodafone, made an unsuccessful attempt to acquire Tele Columbus, meeting resistance from the German antitrust regulator.