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Liberty Global Acquires Cables & Wireless, Creates Leading Consumer, B2B Communications Provider in Latin America and the Caribbean

Nov 17, 2015 03:49 AM EST | By Jean-Claude Arnobit
Liberty Global plc, Cable & Wireless Communications, acquisition
Liberty Global Acquires Cables & Wireless, Creates the Leading Consumer and B2B Communications Provider in Latin America and the Caribbean
(Photo : Kevork Djansezian | Getty Images News)

Liberty Global plc has announced in a press release that it will be acquiring Cable & Wireless Communications Plc for approximately £3.5 billion, or $5.3 billion.

The acquisition would create the leading consumer and B2B communication provider in Latin America and the Caribbean.

Liberty said in the press release that the combined company would have 10 million video, broadband, fixed, and mobile telephony subscription services that generate estimated consolidated revenue of over $3.5 billion.

The combined company would also have estimated consolidated operating cash flow of $1.4 billion for the twelve months ended on September 30, 2015.

Liberty adds in the press release that the acquisition of Cables& Wireless also positions Liberty's LiLAC Group to capitalize in the business market throughout the region.

LiLAC will benefit from Cable & Wireless' product portfolio and extensive terrestrial and submarine network.

Liberty adds in the press release that the combination of the two companies also allows them to take advantage of efficiencies coming from the combined scales of the two companies.

The combined company can also leverage on both companies' complementary experience in product development and customer-centricity.

Mike Fries, the CEO of Liberty, said in the press release that the acquisition represents a "watershed moment" for the company's LiLAC platform.

"It will add significant scale and management depth to our fast-growing operations in Latin America and the Caribbean while creating a new regional consumer and B2B powerhouse," he said.

Fries adds in the press release that he is confident that the combination will provide "substantial synergies and accelerate the current prospects for the LiLAC Group."

"Our high-quality networks and commitment to product innovation will provide the foundation for growth and value creation for both Liberty Global and LiLAC shareholders," he said.

The Chicago Tribune adds that the acquisition gives John Malone, the billionaire who controls Liberty, a critical mass in Latin America.

Malone created a tracking stock in July called LiLAC for his assets in Chile and Puerto Rico.

People familiar with the matter told the Chicago Tribune last month that Malone is looking to amass cable companies across Latin America.

Malone has spent more than $50 billion in the past decade amassing cable companies across Europe.

Liberty's stock offer is valued at 78.04 pence per Cable & Wireless shares, based on the closing share prices as of November 13, 2015, according to the press release.

Cable & Wireless shareholders will also receive three pence per share special dividend at the closing of the transaction.

Reuters adds that the offer represents approximately a six percent premium to Cable & Wireless' Monday close.

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