World VoIP NewsKDG attracts the attention of private equity trioKDG attracts the attention of private equity trio

KDG attracts the attention of private equity trio


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Three private equity firms – Advent, BC Partners and Carlyle – are set to submit bids for German cable operator Kabel Deutschland (KDG), Reuters reports, citing people familiar with the matter.
In what could be the largest leveraged buyout in more than two years, KDG could sell for up to EUR5 billion (USD6.8 billion) sources said, adding that banks will offer up to EUR4 billion of leverage in support of a deal. It is possible that some of the firms could make joint offers because of the amount of equity needed, although the report states that BC Partners will bid without Apollo; the two firms sold German cable operator Unitymedia to US cable company Liberty Global Inc for EUR3.65 billion in November 2009. Meanwhile Apax, which approached KDG’s owners seeking exclusive negotiations before the start of the process, has not placed an offer as it sees the business as too expensive, two other people said.

As reported by CommsUpdate, the owners of KDG asked for indicative bids for the company by 8 February. KDG, which is 88% owned by Providence Equity, with the remainder held by Ontario Teachers' Pension Plan (8%) and company management (4%), is also sounding out options for an initial public offering (IPO). Staple financing is already thought to be in place with a number of banks – including Morgan Stanley, Deutsche Bank, UBS and JP Morgan – hired for the IPO, which could be launched as early as the second quarter of this year.


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