Liberty Global plc.
), a leading cable MSO (multi-service operator) in Europe, recently
offered some concessions to ward off anti-trust regulatory body,
European Union (EU) Competition Commission regarding its proposed
takeover of Ziggo N.V., the largest cable MSO in the Netherlands.
In Jan 2014, Liberty Globalhad reached an agreement to acquire a
100% stake in Ziggo.
As part of the concessions offered, Liberty Global has decided
to vend its pay-TV channel "Film1." Furthermore, the company will
not prevent online video streaming service providers from accessing
its web (Internet) network for the next four years either
contractually or technically.
Low-cost online video streaming service providers depend
completely on Internet links for their offerings. The regulatory
body is likely to take into consideration the feedback of third
parties on the terms of the concessions.
At present, Liberty Global holds a 28.5% stake in Ziggo.
Notably, the company will pay around $13.6 billion to acquire the
remaining 71.5% stake in Ziggo including its outstanding debt. The
deal will be completed through a stock and cash transaction.
The EU regulatory body is currently evaluating the deal and has
expressed its concern over the impact the merger will have on the
Netherlands' cable TV industry and on the Flemish-speaking areas of
neighboring Belgium. The EU deadline for a decision on the deal is
Oct. 17, 2014.
Liberty Global boasts a strong presence in the Dutch cable TV
market as its UPC Broadband Holding BV unit is the second largest
cable MSO in the nation.A merger between Liberty Global and Ziggo
will create a dominant cable TV operator in the Netherlands with
approximately 10.8 million revenue generating units. Ziggo also
competes with telecom operators such as Royal KPN N.V. and Vodafone
Group plc. (
Liberty Global is striving to extensively penetrate the European
region with its bundled video, voice and Internet (data) services.
The company has also joined the RDK Management LLC., a joint
venture between U.S. cable giants Comcast Corp. (
) and Time Warner Cable Inc. (
In 2013, Liberty Global acquired the license to test RDK
standard on its next-generation Horizon IP video gateways. Liberty
Global currently carries a Zacks Rank #3 (Hold).
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