September 20, 2013 09.50 Europe/London By Julian Clover
Vodafone’s €11 billion takeover of Kabel Deutschland has led to a renewed enthusiasm for the cable sector.
Michiel Strater, MD, ING Commercial Banking, told CTAM EuroSummit delegates of a new optimism. “All the M&A bankers in Europe are updating their prospect sheets, particularly Rosalia’s,” he said, referring to fellow panellist Rosalia Portela, CEO of Spanish cablenet ONO.
Looking at potential further targets for the British mobile operator, Strater said Italy and Spain were the most likely markets where Vodafone might make a move. “It makes sense to do something where you already have operations, so that narrows it down, and where there is unlikely to be competition concerns.”
Amid low interest rates both Liberty Global and Verizon had found it relatively straightforward to raise several billion dollars in a matter of days to fund purchases of Virgin Media and Vodafone’s US interests.
Commenting on the Kabel Deutschland purchase Matthias Kurth, executive chairman of trade body Cable Europe, said Vodafone and other operators had seen the advantage of the established cable networks. “A mobile network is just a fixed network with the last 100 ms with an antenna,” he said.
Stater said he believed cable had given itself an advantage over other networks. “The biggest mistake you can make is to fall asleep. Youll be the leader for three or four years, but you need to spend 20 per cent of your revenues on R&D.”