NTL Buys Cablecom for $3.7 Billion
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In a move that lands major network capacity and market share for the British telco, NTL Inc. Monday bought Switzerland's Cablecom Group in a $3.7 billion deal.
Cablecom, which was purchased from Swisscom AG, Siemens Schweiz AG and VEBA, recently added digital television and high-speed Internet services to its business offerings. SwissOnline, a Cablecom portal and the second largest ISP in Switzerland, also falls into the acquisition.
Cablecom itself is the country's largest cable operator, boasting 1.38 million subscribers. The company is also licensed for Internet, leased line and other data services, and plans to extend its license operations into VoIP telephony.
NTL (NTLI) will also get infrastructure improvements as part of the deal -- Cablecom previously committed $250 million to upgrade its network by 2003, and by the time the project is complete the company expects to cover 75 percent of the region through two national fiber rings.
"[Cablecom] is an extremely well managed company, with a very high quality network, 96 percent customer penetration rates and huge potential for growth from traditional and new CATV services, businesses and residential telecoms and full service broadband communications," said Barclay Knapp, chief executive officer of NTL.
Knapp said the deal was important to NTL's Europe strategy because of its central location and reputation as a premier communications asset in the region.
NTL was one of the first players in the digital TV market, and now enlists 22 million homes to its services. The company previously bought Cable & Wireless Communications' consumer operations.
The acquisitions will effectively make NTL the largest operator in the UK, in conjunction with its properties in Ireland, Australia, Singapore and France.