The sale of Bulgaria’s leading cable operator blizoo to Telekom Austria’s Mobiltel (MTel) is undoubtedly one of the biggest TV industry deals so far this year in Central and Eastern Europe.
However, it should really come as no surprise, given that blizoo was probably on the market for at least two years. Indeed, it was then being reported that its owner, the Sweden-based investment fund EQT V, was looking for a buyer and invitations to bid would be sent to Bulgaria’s three largest telcos – MTel, Globul and BTC – along with a number of financial investors.
Nothing nevertheless materialised and the company would remain in the hands of EQT V for a further two years.
EQT V entered the Bulgarian cable market back in October 2009, when it announced the acquisition of 100% of Eurocom and 70% of CableTel, from Warburg Pincus and Gene Philips respectively, for a combined total of €200 million. It then went on the merge the companies into a single operator that it named blizoo and automatically became the largest provider of cable services in the country.
EQT V did not rest on its laurels during the time it owned blizoo. Finding itself in a highly competitive electronic communications market in which Bulsatcom was, and still remains, the leading player, it set about modernising the company and today it is the only cable operator in the country to offer its subscribers internet access at up to 200 Mbps.
Blizoo has also performed well financially, generating sales of €47 million and an EBITDA of €19 million in 2014.
The fact that Telekom Austria will through MTel be the new owner of blizoo is not really surprising, given that the telco did business with EQT V in June last year when it acquired blizoo’s sister company in Macedonia.
For Telekom Austria, the latest deal will significantly strengthen its position in what by its own admission is a challenging market. It will also eventually benefit both MTel and blizoo subscribers, allowing them to access a wider range of services.
