Tele Columbus Group announced an agreement to acquire PrimaCom for EUR 711 million. The deal brings together two of Germany's leading mid-tier cable operators. Tele Columbus said the combined company offers growth potential and enables scale efficiencies across the customer and network base. The merger should also support an acceleration in network and product development. The acquisition of PrimaCom will be financed through a combination of existing cash, a fully underwritten financing with senior and junior tranches and a EUR 125 million equity bridge loan. The transaction does not need regulatory approval and is expected to close at the end of July.
PrimaCom owns and runs its own hybrid fibre coax network providing telecommunications and cable TV services to approximately 1.2 million homes connected. In 2014, PrimaCom acquired cable network operator Deutsche Telekabel with approximately 270,000 homes connected and revenues of EUR 132 million. PrimaCom employs approximately 450 people and is based in Leipzig.
The combination will result in a network connecting a total 2.8 million homes in Tele Columbus' core Eastern Germany regions as well as key Western regions such as Baden-Wuerttemberg, Hamburg, Hesse and North Rhine-Westphalia. Both companies have just over 50 percent of homes upgraded for two-way communications and investment programmes in place to increase migration to own signal-delivery and two-way upgrades. Based on 2014 figures, there combined annual revenues are EUR 345 million, and EBITDA reached EUR 154 million.
Given the acquisition of PrimaCom, Tele Columbus will postpone the announcement of its financial results for the second quarter, from 7 August to 14 August.
