Liberty Global has offered to acquire UK-based telecoms group Cable & Wireless Communications (CWC) for GBP 3.5 billion in a bid to expand its Caribbean business. The announcement comes six months after Liberty Global's largest shareholder John Malone acquired a 13 percent stake in CWC following the UK group's EUR 1.85 billion acquisition of Columbus International. Last month the companies confirmed they had entered into talks about bringing together CWC’s strong position in the Caribbean with Liberty’s operations in Chile and Puerto Rico. The stock offer for CWC is valued at 78.04 pence per share, based on closing share prices as of 13 November, with shareholders also receiving a special dividend of 3 pence per share.
In a statement, Liberty Global said the offer represented a purchase price multiple of 10.7x CWC’s adjusted EBITDA on 30 September after taking into consideration the unrealised cost synergies resulting from CWC’s acquisition of Columbus International. The combined business would serve 10 million video, data, voice and mobile subscribers, said Liberty Global's CEO Mike Fries, adding that additional synergies would be expected beyond the previously reported USD 125 million. CWC said Liberty Global’s offer valued the company at about USD 8.2 billion, including debt, and that it expected the transaction to close in the second quarter of 2016.
Liberty Global recently announced that it had ended discussions with Vodafone about an exchange or combination of assets. The C&W offer is in line with the cable group's expansion in the mobile market, after it agreed earlier this year to acquire Belgium’s third-largest operator Base for EUR 1.33 billion.
