Kabel Deutschland KDG has submitted a remedy package for the planned Tele Columbus acquisition to the Bundeskartellamt.
The remedies include the sale of Tele Columbus network assets in Berlin, Dresden and Cottbus.
These remedies are intended to overcome the concerns of the Kartellamt as expressed in the December 2012 statement of objection, especially regarding the housing association market for TV services.
Kabel Deutschland said it remains convinced that consumers and housing associations in Germany will in fact benefit from the proposed acquisition. “As a result of the proposed acquisition, over 900,000 households in Eastern Germany would obtain first-time access to high speed internet over cable. Thus, the proposed acquisition would contribute significantly to the broadband strategy of the German Government.
“As a result of the transaction, Kabel Deutschland would in addition become active outside its current footprint by entering into competition for contracts with housing associations in North Rhine-Westphalia and Hesse. “
KDG said it does not share the Kartellamt’s concerns regarding the proposed acquisition. In order to overcome these concerns, Kabel Deutschland has nevertheless decided to offer the sale of certain network assets and corresponding housing association contracts of Tele Columbus.
The Kartellamt considers the sale of network assets to be the only appropriate remedy in the specific case of the TeleColumbus acquisition.
The remedy package offers to sell network assets of Tele Columbus in Berlin, Dresden and Cottbus with more than 430,000 homes connected including the respective housing association contracts.
These asset sales would reduce the size of the transaction of originally 2.1 million homes connected by approximately 20%. In terms of subscribers, the asset sales would amount to a reduction of roughly 330,000 subscribers out of a total of 1.6 million subscribers.
The Kartellamt has not decided on the remedy offer and will put it up for a ‘market test’.
