Vodafone has given Kabel Deutschland (KDG) shareholders until 11 September to tender their shares for a total €87 each, aiming to settle the takeover offer by early June 2014 at the latest. But it also said in an ideal scenario closing could occur in…
Vodafone has given Kabel Deutschland (KDG) shareholders until 11 September to tender their shares for a total €87 each, aiming to settle the takeover offer by early June 2014 at the latest. But it also said in an ideal scenario closing could occur in October.
The UK-based operator launched its public takeover offer of €84.50 per share in cash together with a proposed €2.50 dividend today.
If all KDG shareholders take up the offer, which has an acceptance threshold of 75%, Vodafone will have to pay a total €7.48bn for 88.5 million shares.
Vodafone said the offer represents a 51% premium on the weighted average price of KDG shares in the three months ended 12 February 2013, the last full trading day before media reports appeared asserting its interest in the German cableco.
As of today, Vodafone said it has bought just over 3.75 million KDG shares, equal to a stake of about 4.2%.
In its offer document, Vodafone said the acceptance period may be extended in certain circumstances. There will also be an additional two-week acceptance period after the publication of the results of the takeover offer. If published on 16 September as expected, the additional acceptance period will end on 30 September.
The offer is subject to numerous completion conditions, such as European Commission merger control clearance.
If conditions are fulfilled on the latest possible date, 31 May 2014, settlement of the takeover offer is expected to be delayed until early June that year.
However, the deal could close as early as September or October this year if the EC receives formal notification by the end of August and clears it after a phase one investigation.
If the commission launches a phase two investigation or refers the case to Germany’s Federal Cartel Office (FCO), the process will take much longer.
In its offer document, Vodafone said it has secured the finances to meet payment obligations. The operator said that, as of 30 June, it had cash and liquid resources of £12.2bn (€14.2bn) as well as access to certain credit facilities.
Vodafone said its combination with KDG will “create a leading integrated communications operator in Vodafone’s largest European market”.
“[KDG] provides Vodafone with an attractive platform for TV and fixed broadband in Germany and creates a leading integrated operator with pro forma revenues of approximately €11.5bn. Leveraging [KDG’s] high-speed broadband and TV capabilities will provide Vodafone with the ability to offer premium unified communications services to consumers and businesses in Germany.”
Vodafone and KGD first entered into a business combination agreement on 24 June. John Malone’s Liberty Global also submitted a preliminary bid for KDG of about €85 per share, but conceded defeat to Vodafone earlier in July.
