Liberty Global PLC’s Belgian unit agreed to buy Royal KPN NV’s local mobile phone business for 1.33 billion euros (US$1.43 billion) in cash as billionaire John Malone expands his European cable and telecommunications empire.
Telenet Group Holding NV, majority-owned by Malone’s Liberty Global, gains the Base network as it seeks to challenge larger Belgacom SA and Mobistar SA.
Telenet, which yesterday said it plans to finance the takeover with 1 billion euros of new debt in addition to existing cash, currently rents capacity from Mobistar.
Photo: Bloomberg
The deal lets Liberty Global build a Belgian business with 2.4 billion euros in sales, while also targeting savings of 150 million euros in the country.
Malone has expanded through purchases across Europe and London-based Liberty Global now owns cable and telephone operations stretching from Hungary to the UK. The company has also added TV content and production to drive growth.
The price values Base at eight times the unit’s estimated earnings before interest, taxes, depreciation and amortization for this year, the companies said.
KPN shares increased 2.7 percent to 3.25 euros at 9:44am in Amsterdam, as Telenet rose 4.2 percent to 54.67 euros in Brussels. Liberty Global lost 1.3 percent in New York on Friday.
The purchase gives Telenet about 3.3 million mobile subscribers, bringing the total to more than 4 million. That compares with more than 5 million for each Belgacom and Mobistar, which is majority-owned by Orange SA.
KPN chief executive officer Eelco Blok’s efforts to sell Base in 2012 were halted, because the bids were too low. With a sale of Base, The Hague-based KPN would have operations only in its home market of the Netherlands, since the carrier completed the sale of its German unit E-Plus to Telefonica Deutschland Holding AG last year.
Billionaire Carlos Slim’s America Movil SAB is the biggest investor in KPN, with a 21.4 percent stake. KPN holds a 20.5 percent stake in Telefonica Deutschland as a result of the sale, and Blok has said that he is open to sell if the right opportunity arises.
Base has said it is focused on increasing the share of customers with monthly contracts and their data usage in Belgium, where consumption remains relatively low. KPN said this month several parties had expressed interest in buying Base.
“The price is not too bad, I would have expected a little bit less,” Theodoor Gilissen Bankiers NV analyst Tom Muller said by telephone. “Now you have to wait and see how the consolidation in Europe is going to play out.”
DECOUPLING? In a sign of deeper US-China technology decoupling, Apple has held initial talks about using Baidu’s generative AI technology in its iPhones, the Wall Street Journal said China has introduced guidelines to phase out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) from government PCs and servers, the Financial Times reported yesterday. The procurement guidance also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic options, the report said. Chinese officials have begun following the guidelines, which were unveiled in December last year, the report said. They order government agencies above the township level to include criteria requiring “safe and reliable” processors and operating systems when making purchases, the newspaper said. The US has been aiming to boost domestic semiconductor
Nvidia Corp earned its US$2.2 trillion market cap by producing artificial intelligence (AI) chips that have become the lifeblood powering the new era of generative AI developers from start-ups to Microsoft Corp, OpenAI and Google parent Alphabet Inc. Almost as important to its hardware is the company’s nearly 20 years’ worth of computer code, which helps make competition with the company nearly impossible. More than 4 million global developers rely on Nvidia’s CUDA software platform to build AI and other apps. Now a coalition of tech companies that includes Qualcomm Inc, Google and Intel Corp plans to loosen Nvidia’s chokehold by going
ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to