Four years after Germany’s federal cartel office vetoed an attempt by the country’s largest cable operator to take over its smaller competitors, Kabel Deutschland (KDG) is considering a renewed attempt.


“A nationwide cable provider would serve the market and therefore the viewers,” KDG’s CEO Adrian von Hammerstein told German financial newspaper Handelsblatt, adding, however, that no concrete negotiations were currently taking place. Von Hammerstein said that in any event the company was interested in acquiring and operating networks throughout Germany, claiming that this would make the acquisition of new customers simpler and more efficient, while also enabling the company to make better use of the technical infrastructure.

In 2004 KDG tried to take over the cable operators serving regional states of Baden-Wurttemberg, Hessen and North Rhine-Westphalia, which would have filled the remaining gaps and given KDG nationwide coverage, but the deal was blocked by the cartel office amid fears of the company gaining a dominant market position. In the meantime, however, the market has changed with ADSL providers such as Deutsche Telekom, Arcor and HanseNet developing into competitors for cable operators with their triple play packages of TV, internet and telephony, while cable operators compete with telecommunications companies by offering internet and telephone connections. It is therefore possible that the cartel office could now decide in favour of the attempt.

KDG belongs to private equity company Providence, which fully acquired the Munich-based media company three years ago. As Germany’s second and third largest cable operators Unitymedia and Kabel BW are also in the hands of financial investors, a takeover by KDG could be a possible scenario. The unified heavyweight could be of interest to a strategic investor such as Liberty Global, owned by US cable mogul John Malone.

Source: Rapid TV News 2008

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