KDDI and Sumitomo to merge cable services ops

Louise Duffy | 25-10-2012

KDDI and Sumitomo have announced that they plan to buy shares they do not already own in cable services provider Jupiter Telecommunications Co (JCOM) for 216 billion yen ($2.71 billion), in a step towards merging the two firms' cable businesses.

According to Reuters, KDDI and Sumitomo, which together own 70.7% of JCOM, will offer 110,000 yen for each remaining share in Japan's biggest cable service provider. That represents a premium of 33% to JCOM's closing price of 82,700 yen on Friday, before reports of the merger.

After the tender offer, JCOM will be delisted and made a 50-50 joint venture. JCOM will then acquire Japan Cablenet, now 95.6%-owned by KDDI.