John Malone’s Liberty Global Plc agreed to buy Cable & Wireless Communications Plc in a cash-and-stock transaction valued at 3.5 billion pounds ($7.5 billion), extending the US billionaire’s European cable empire deeper into Latin America.
Cable & Wireless shareholders will get a special 3 pence-a-share dividend at the deal’s close, according to a statement Monday. The transaction is valued at 78.04 pence per CWC share, based on Friday’s closing price.
The purchase gives Malone a critical mass in Latin America, where he created a tracking stock in July called LiLAC for Liberty Global’s assets in Chile and Puerto Rico. Malone, who spent more than US$50 billion the past decade amassing cable companies across Europe, looks to do the same in parts of Latin America, and may even spin off that unit in the future, people familiar with the matter said last month, when the companies announced they were in talks.
The acquisition is a “watershed moment” for LiLAC, as it “will add significant scale and management depth to our fast-growing operations in Latin America and the Caribbean,” Liberty Global Chief Executive Officer Mike Fries said in the statement. The combined business will serve 10 million video, data, voice and mobile subscribers, he said.
Cable & Wireless, which also owns a network in the Seychelles, received more than half of its $1.75 billion in revenue last year from Panama and the Caribbean. Malone became a shareholder last year when Cable & Wireless bought his cable-TV and Internet provider Columbus International Inc. As part of that deal, Malone and the two co-founders of Columbus were given a 36 percent stake of the combined company.
In a statement, Cable & Wireless called Liberty Global an “outstanding custodian of our business” and said the enlarged company will expand consumer and business-to-business services even faster.
As part of the deal, Liberty Global will take on CWC’s net debt, which was US$2.7 billion as of Sept. 30. The deal represents a multiple of 10.7 times CWC’s adjusted annual earnings before interest, depreciation, taxes and amortisation, after taking into consideration cost synergies.
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Cable & Wireless shareholders will get a special 3 pence-a-share dividend at the deal’s close, according to a statement Monday. The transaction is valued at 78.04 pence per CWC share, based on Friday’s closing price.
The purchase gives Malone a critical mass in Latin America, where he created a tracking stock in July called LiLAC for Liberty Global’s assets in Chile and Puerto Rico. Malone, who spent more than US$50 billion the past decade amassing cable companies across Europe, looks to do the same in parts of Latin America, and may even spin off that unit in the future, people familiar with the matter said last month, when the companies announced they were in talks.
The acquisition is a “watershed moment” for LiLAC, as it “will add significant scale and management depth to our fast-growing operations in Latin America and the Caribbean,” Liberty Global Chief Executive Officer Mike Fries said in the statement. The combined business will serve 10 million video, data, voice and mobile subscribers, he said.
Cable & Wireless, which also owns a network in the Seychelles, received more than half of its $1.75 billion in revenue last year from Panama and the Caribbean. Malone became a shareholder last year when Cable & Wireless bought his cable-TV and Internet provider Columbus International Inc. As part of that deal, Malone and the two co-founders of Columbus were given a 36 percent stake of the combined company.
In a statement, Cable & Wireless called Liberty Global an “outstanding custodian of our business” and said the enlarged company will expand consumer and business-to-business services even faster.
As part of the deal, Liberty Global will take on CWC’s net debt, which was US$2.7 billion as of Sept. 30. The deal represents a multiple of 10.7 times CWC’s adjusted annual earnings before interest, depreciation, taxes and amortisation, after taking into consideration cost synergies.
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