Council of State rejects Interkabel deal with Telenet

May 27, 2014 22.13 Europe/London By Robert Briel

judgement hammerThe Belgian Council of State (Raad van State) has rejected the procedure in which Interkabel transferred around 800,000 TV subscribers to Telenet.

The Council ruled in a case started by Belgacom, who tried to stop the takeover by filing a complaint with the authorities claiming the municipalities should have started an open tender rather than exclusively negotiate with Telenet. The telco argued that the cable networks making up the Interkabel consortium are owned by a number of municipalities, and under European law, as public companies, they should have started an open tender rather than make a deal between closed doors.

Partly based on the reply of the European Court of Justice for a preliminary ruling, the Council of State sided with Belgacom that this transaction should not be done without market survey and consequently wrongly refused to enter into negotiations with Belgacom

In 2008 Telenet signed an agreement with the municipal cable operators and their joint venture Interkabel to acquire the TV activities of the networks, consisting of four networks Integan, Intermedia, PBE and WVEM all based in Flanders and serving about 800,000 homes.

In a statement, Telenet said that the deal is not annulled, but only the decision that the four municipalities did not start an open market procedure.

Belgacom is now free to start civil proceedings in order to have the agreement annulled and claim damages. For the time being, such court action will not impact the day-to-day business of Telenet.