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.
