Liberty Global buys German cable operator in $5.2 billion deal

Cable operator Liberty Global has announced it will acquire German broadband cable operator Unitymedia for $5.2 billion. The takeover, which is expected to be completed in the first half of 2010, is designed to boost Liberty GlobalÔÇÖs presence in the European marketplace. The Englewood, Colorado-based firm, which is controlled by US cable pioneer John Malone, is already active in areas of Europe such as Austria, the Netherlands, Poland, Hungary and Romania.  It also has operations in Japan, Chile and Australia. Cologne-based Unitymedia is the largest cable television operator in the German federal states of North Rhine-Westphalia and Hesse, the most densely populated regions of Germany which produce around a third of GermanyÔÇÖs GDP.  Its cable footprint, passing approximately 8.8 million homes, covers 10 of the 20 largest cities in Germany, including Cologne, Dusseldorf and Frankfurt. Deutsche Telekom is one of UnitymediaÔÇÖs main competitors. The German firm was created in 2005 from the merger of regional cable companies Iesy, Ish and Tele Columbus.  As of September 2009, Liberty Global operated networks that served approximately 17 million customers across 14 countries.  The US companyÔÇÖs operations also include programming businesses, such as Chellomedia in Europe. Commenting on the deal, Mike Fries, president and CEO of Liberty Global said: "We are excited about this transaction as it complements our existing European footprint and has significant untapped growth potential in one of the fastest growing cable markets in Europe.  ÔÇ£The addition of Unitymedia not only enhances our European presence, but adds significant scale to our global operations, as our footprint, including Unitymedia, will exceed 40 million homes.ÔÇØ Liberty Global will buy all Unitymedia shares for Ôé¼2 billion ($2.9 billion) and will also assume the German companyÔÇÖs Ôé¼1.5 billion ($2.2 billion) of net debt. Unitymedia is owned by a group of shareholders led by two private equity firms: UK-based BC Partners and New York-based Apollo. *┬á┬á┬á┬á┬á┬á┬á *┬á┬á┬á┬á┬á┬á *