Monday, 27 January 2014 - 12:16
Ziggo taken over by Liberty Global in €10b deal
As expected, Liberty Global has signed an agreement to acquire Dutch cable company Ziggo in a deal valued at about €10 billion. Liberty Global, which owns UPC cable group in the Netherlands, is offering €34.53 a share for Ziggo. Under the agreement, Ziggo shareholders will receive €11 in cash, 0.2282 class A ordinary shares and 0.5630 class C ordinary shares of Liberty Global for each Ziggo share, according to a news release. Ziggo - Photo: Bloomberg Both Ziggo’s management board and supervisory board believe that the Liberty’s offer is in the best interests of the company and its stakeholders, including its shareholders. The deal is subject to approval by the company's shareholders and regulators. Liberty already owns almost 30% in Ziggo. Now, the company will acquire the remaining ordinary shares of Ziggo or about 143.1 million shares. The combined footprint of the two companies will reach 7 million or over 90% of Dutch homes, the companies said in a statement. The companies have agreed to certain covenants in respect of financing, corporate governance, post-closing measures, strategy, organization, integration, employees, security and privacy for a duration of two to three years after settlement. Liberty said it recognizes that Ziggo’s management and employees will be vital to the combined Dutch business and expects to rely on their experience and expertise going forward. "Liberty will respect the existing employment rights and benefits of employees of Ziggo, including existing social plans, profit sharing schemes, covenants and collective labor agreements, as well as the terms of individual employment agreements between Ziggo and its employees, for the agreed duration of these arrangements and agreements or, if earlier, as soon as any new harmonization or redundancy plans have been negotiated," according to a news release. Ziggo’s head office and relevant head office functions will remain in Utrecht, which would be the head office for the combined Dutch businesses. Last week, Ziggo reported that it recorded an exponential profit increase of 80%, 347 million euros, over 2013. In October, Ziggo rejected an offer from Liberty saying that the proposed price was too low. The company did not disclose how much Liberty offered at that time.