Dual track strategy for Kabel Deutschland

Majority owner Providence Equity is preparing an IPO for Kabel Deutschland (KDG), while at the same time looking for a buyer for its 88% stake in Germany’s largest cable operator.

According to German newspaper reports citing people ‘familiar with the situation’, KDG plans to float in the second quarter of the year. But Financial Times Deutschland said it learned that the cabler is also looking at a potential buyer. Last November, a similar dual track strategy worked well for Unitymedia, which changed hands for €3.5 billion with Liberty Global snapping up the Cologne-based operator from BC Partners and Apollo Management.

KDG first hinted at an IPO last November, “It is no secret. We are rumoured to be looking at a potential IPO in 2010. I do not know whether that will or will not happen. But we are here to introduce ourselves,” KDG CTO Paul Thomason said at an investor conference in Barcelona.

There have also been unconfirmed rumours about Liberty Global and Vodafone being interested, but these two companies both officially denied any interest in buying KDG.

KDG is currently 88% owned by Providence Equity, with the remainder held by Ontario Teachers’ Pension Plan (8%), and company management (4%). The operator serves more than 9 million customers in 13 German states with triple play services.