For free real time breaking news alerts sent straight to your inbox sign up to our breaking news emails
Sign up to our free breaking news emails
America’s “King of Cable”, John Malone, is to swallow Cable & Wireless Communications in a £3.6bn deal that will beef up his Liberty Global group’s Latin American footprint.
The recommended offer, which follows many weeks of talks, represents an indicative value of 86.82p per Cable & Wireless share, a premium of about 18 per cent to the stock’s closing price yesterday.
The cash and stock deal is worth 10.7 times Cable & Wireless’s annual earnings before tax. Including £1.8bn of debt, it is worth £5.4bn.
Cable & Wireless Communications bears the name of one of the oldest British companies on the stock exchange, with its roots stretching back to 19th century telegraph companies in the age of empire. Today it offers pay-TV, internet, landline phone and wireless services in the Caribbean, Panama, Monaco and the Seychelles and has about six million subscribers. Liberty already has assets in Chile and Puerto Rico.
Mr Malone has spent more than $50bn (£33bn) over the past decade buying cable companies across Europe, including Virgin Media in 2013, and this deal suggests a similar approach in Latin America.
In September Liberty and Vodafone announced the breakdown of talks to swap certain assets. The CWC deal is likely to kill off any hopes of reviving those talks.
Business news: In pictures
Show all 13
Mr Malone is Liberty Global’s largest shareholder. He already owns 13 per cent of CWC following its $3.3bn acquisition of Columbus International earlier this year.
Mike Fries, Liberty’s chief executive, said the deal would add “significant scale and management depth to our fast-growing operations in Latin America and the Caribbean”.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies