The combination of the pair will create a new operator with 2.8 million connected homes, with what Tele Columbus says has strong potential growth prospects in broadband internet and telephony and a strong position in the key German housing association market.
Tele Columbus said the deal underlined its role in the ongoing consolidation of the German cable market and would enable the combined company to realize scale efficiencies across its combined customer and network base.
Leipzig-based PrimaCom serves 1.2 million connected homes. The company expanded last year with the acquisition of Deutsche Telekabel. The combination of its networks with those of Tele Columbus will create an operator with a strong presence in eastern Germany in particular, but with a network presence in western regions including Hamburg and Liberty Global-owned Unitymedia’s home base of Baden-Württemberg, Hess and North-Rhine Westphalia.
Some 56% of Tele Columbus’s connected homes are two-way ready, alongside 57% of PrimaCom’s.
The acquisition will be financed by a mix of cash and debt. According to Tele Columbus the deal, which does not require regulatory approval, is expected to close at the end of this month.
“This is a transformational transaction for Tele Columbus, strengthening our position as the number three player in the German cable market. Strategically and economically, this is a highly logical combination with significant network complementarity between the two businesses and complementary Housing Association customer bases. PrimaCom has demonstrated an impressive financial and operational performance over recent years and we look forward to further success going forward,” said Tele Columbus CEO Ronny Verhelst.
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