Tele Columbus to take over Primacom

Kicking off a new consolidation round in Germany’s cable market, Tele Columbus, the third largest German cable operator, has entered into an agreement to acquire Primacom, the fourth largest market player, for €711 million.

The combination of both companies will lead to a strong third force in the German cable market after Kabel Deutschland and Unitymedia serving a total of 2.8 million households. The transaction is expected to be closed on July 31, 2015.

“This is a transformational transaction for Tele Columbus, strengthening our position as the number three player in the German cable market,” Ronny Verhelst, CEO of Tele Columbus, said in Berlin. “Strategically and economically, this is a highly logical combination with significant network overlap between the two businesses and complimentary housing association customer bases. Primacom has shown impressive financial and operational performance over recent years and we look forward to further successes going forward.”

Joachim Grendel, CEO of Primacom, added: “Combining Tele Columbus and Primacom will build an excellent basis for the future competition with the global media and telecommunications corporates. This merger will be to the benefit not only of consumers and our partners in the housing industry, but also of Germany as a media and high-tech country.”

PrimaCom currently serves around 1.2 million households. In 2014, the company acquired cable operator Deutsche Telekabel and generated total revenues of €132 million and adjusted EBITDA of €55 million, resulting in a margin of 42%. Primacom currently employs around 450 people with corporate headquarters in Leipzig.

Tele Columbus which serves around 1.7 million households will finance the acquisition through a combination of cash on balance sheet, a fully underwritten financing including both a senior and junior tranche and a €125 million equity bridge loan. The transaction does not need regulatory approval and is not subject to merger control review, according to Tele Columbus.

A spokesman of federal cartel office Bundeskartellamt confirmed toBroadband TV News that the deal is not subject to review by the competition authority as the companies’ combined turnover in 2014 didn’t exceed the €500 million threshold stipulated in the German anti-trust law.

With the move, Tele Columbus and Primacom which used to be connected through their former joint parent company Orion Cable will be brought together again. In the past years, there have been several unsuccessful takeover attempts. In 2013, the planned purchase of Tele Columbus by Kabel Deutschland was blocked by Germany’s federal cartel office.

Industry experts expect the consolidation in the German cable market to continue. Tele Columbus could, for example, acquire Pepcom as the next step to strengthen its market position.

Germany's primacom selects Conax revenue security for cable TV

primacom selects Conax revenue security for cable TV growth in Germany

• Conax Contego™ unified security back-end provides primacom with a rock solid, highly reliable and scalable foundation for future growth, including easy expansion for additional business models

BERLIN — Conax, part of the Kudelski Group (SIX:KUD.S) and a leader in total service protection for pay-for-media, content owners and entertainment services, today announced it is providing primacom, one of Germany’s largest cable TV providers, with content revenue protection for its growing DVB cable and pay-TV network. Based in Leipzig, primacom has deployed the flexible Conax Contego™ unified security back-end to deliver total service protection and streamlined services for its operations nationwide. Conax Contego™ provides enhanced content security architecture for increased scalability and flexible service delivery.

The flexible Conax Contego™ content security platform will illustrate the key role of a unified security solution for forward thinking pay-TV operator, primacom. The Conax technology will protect primacom’s existing DVB cable network while providing both a scalable foundation for growth and the flexibility to continually enrich the service offering. Multiscreen, multi-network and Over-the-Top content delivery packages can be seamlessly integrated with the broadcast offering to create a unified user experience.

primacom provides high-end telecommunications and cable TV services to more than 1.2 million connected households, making primacom the fourth-largest cable network operator in Germany. Active in the multimedia and telecom markets since 1998, primacom is well-established in the German telecommunications market as a nationwide provider with a regional focus, delivering high-end digital TV, HDTV, digital program packages as well as high speed internet access, and modern telephony solutions to end-consumers.

Ludwig Modra, Chief Technology Officer, primacom, “primacom is committed to providing its customers with seamless access to the services and content they desire. We chose security partner Conax and Conax technology based on its long experience, proven track record and reliability – enhancing our consumer commitment. Deploying Conax Contego™ enables primacom to deliver a smooth and intuitive user experience and also provides us with the flexibility needed to satisfy future customer demands beyond our managed network, while also seamlessly protecting our existing network configuration.”

Thomas Blichfeldt, VP EMEA Sales, Conax, “primacom is experiencing strong growth – Conax is delighted to be chosen to collaborate with the primacom team on the deployment of their conditional access solution to support their future platform expansion. The flexible Conax Contego™ security back-end is well-suited to protect primacom’s highly popular service offerings. Highly scalable and modular Conax Contego™ technology will enable primacom to easily align their security coverage beyond a managed network to include DRM and secure delivery of premium content to a multitude of devices when they are ready to integrate new Multiscreen and Over the Top (OTT) services.”

The Conax Contego™ universal security hub ensures secure video delivery across a broad range of networks and device types, providing flexibility in selection of security evaluated client devices, seamless middleware interoperability and proven scalability. Based on 25 years of experience, today Conax is the security partner of choice for 400 operators in 85 countries.

Primacom bids for Tele Columbus, Telekabel

Germany’s Primacom wants to buy Tele Columbus Berlin and Deutsche Telekabel.

The cabler’s managing director Wolf Waschkuhn told Reuters the company wants an active role in the market’s consolidation: “We are hunters not hunted. We are ready to be a consolidator”.

Tele Columbus is up for sale and recently attracted interest from private equity groups CVC and Cinven, which are offering to buy it in a potential deal valuing the company’s equity and debt at roughly EUR 600 million, according to people familiar with the negotiations.

Kabel Deutschland earlier this year walked away from buying Tele Columbus for about EUR618 million after the Bundeskartellambt blocked the deal.

The German cable market is going through a process of consolidation. Vodafone EUR7.7 billion takeover of Germany’s largest cable company Kabel Deutschland, while Liberty Global has merged Unitymedia and KabelBW.