RealTime IT News

UPC To Acquire Dutch Cable Interests

United Pan-Europe Communications (UPC) announced Thursday that it plans to acquire K&T Group, the cable interests of Dutch corporation N.V. Eneco for NLG 2.35 billion ($1.07 billion), as well as the smaller Tebecai cable system.

K&T has over half a million basic cable television subscribers but only 6,000 broadband Internet subscribers. However, 85 per cent of the network is already two-way capable and the company is about to offer broadband services to the majority of its customers.

UPC says it is also acquiring Tebecai, a cable system in the east of Holland, for NLG 157 million ($71 million), on a debt-free basis. Tebecai has 78,000 basic cable television subscribers and 2,800 Internet subscribers.

Mark Schneider, chairman and chief executive officer of UPC, said the acquisition of Eneco's cable assets represented a key strategic step for UPC in its home market.

"The two-way capability of both the Eneco and Tebecai networks gives us the opportunity to rapidly roll out our Internet and telephony services to both residential and business customers," said Schneider.

"Rotterdam is an important business center while the fiber ring around the Hague also brings access to a substantial business market and reflects a large part of the value of K&T," Schneider added.

UPC is hoping to capture a significant share of the business market in both Rotterdam and The Hague via its Priority CLEC division. Rotterdam, in particular, will become a focus for UPC activity, with support functions scheduled to be located there in the future.

In 1999, K&T generated approximately NLG 161 million ($74 million) turnover, while Tebecai generated NLG 18 million ($8.2 million).

With services in twelve countries, UPC now has a broadband network that passes 9.2 million homes with more than 6.0 million basic cable subscribers. UPC is a subsidiary of Denver based UnitedGlobalCom in which Microsoft has a 7.0 per cent holding.