Bundeskartellamt blocks KDG/TeleColumbus deal

Kabel DeutschlandThe German federal cartel office has deemed the remedy package offered by Kabel Deutschland for the Tele Columbus acquisition as insufficient.

The Bundeskartellamt today informed Kabel Deutschland of its preliminary assessment on the package offered on January 22, 2013. The cartel office judges the proposed divestment of network assets as insufficient to overcome its concerns.

Kabel Deutschland had offered the disposal of Tele Columbus networks in the cities of Berlin, Dresden and Cottbus. The FCO, however, requires the divestment of approximately 60% of the Tele Columbus networks in Eastern Germany – twice as many as offered by Kabel Deutschland.

In a statement, KDG said it regreted the cartel office’s assessment. Kabel Deutschland’s remedy offer was far-reaching and went to the commercial limit. “The envisaged transaction would have benefited infrastructure competition as well as consumers. As a result of the envisaged acquisition, over 900 thousand households in Eastern Germany would have obtained first-time access to high-speed internet over cable.

“In addition, Kabel Deutschland would have become active outside its current footprint by entering into competition for contracts with housing associations in North Rhine-Westphalia and Hesse.”

Kabel Deutschland will continue to pursue its organic growth strategy focusing on internet, telephony and premium TV. “The company’s superior broadband infrastructure and products provide a unique basis for sustained growth over the coming years.”

The announcement by the Bundeskartellamt makes way for fresh rumours about potential buyers for the TeleColumbus networks. This includes Liberty Global, who already owns Unitymedia KabelBW and Vodafone.