Vodafone raises offer for German cable firm to €7.5bn
VODAFONE, which has more Irish shareholders than any other company, has intensified its efforts to buy Germany's largest cable company Kabel Deutschland.
The telecoms giant has raised its preliminary offer for the German business to about €7.5bn in an effort to persuade it to enter talks. Vodafone is now willing to pay Kabel Deutschland €85 a share, compared with the offer of €80 to €82 that the company initially rejected.
The new proposal could lay the groundwork for a bidding war with John Malone's Liberty Global, which has made its own preliminary offer, also thought to be worth €85 a share. Shares in Kabel Deutschland rose past that price yesterday, indicating that investors expect a higher offer.
Liberty already has its own German cable assets, Unitymedia KabelBW. Both Liberty and Vodafone want to get hold of Kabel Deutschland to expand their empires in Europe.
The German company would give Vodafone access to its 8.5 million connected households and potential customers in Europe's biggest telecommunications market.
Liberty Global's offer is thought to be in shares so Kabel Deutschland's management may favour Vodafone's bid because it is all cash and may have better chances of being approved by Germany's Federal Cartel Office.
A bidding war for Kabel Deutschland could push Vodafone to offer as much as €90 a share, said analyst Robin Bienenstock yesterday.
Vodafone's share price fell 0.7pc to £1.83 in early trading yesterday.