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13th August 2002 – Callahan successfully closes acquisition of the Flemish Mixed Intercommunales' cable network in Europe's "worst ever" Telecoms market
Callahan Associates International, the global communications development and operating company, together with the Shareholders of Telenet and the Mixed Intercommunales, (MICs) today 13th August 2002, announces the closing of the acquisition of the 'Mixed Intercommunales' cable networks in Flanders, Belgium.
The acquisition values the MICs cable networks at approximately Euro 944 million.
As part of the transaction, Telenet closed an E1.25 billion senior loan facility, which funds a proportion of the acquisition cost and refinances the facility raised in March 2001 for the Stage 1 acquisition of Telenet by CAI.
The E1.25 billion agreement is the largest single European Telecoms deal to be closed since markets collapsed some 18 months ago ands creates Europe's largest triple play platform, with over 1.5 million CATV, High-speed Internet and broadband telephony subscribers.
Callahan Associates will hold 22.6% of the Equity and retain Operating and Board control.
Each of Callahan Associates' investors who participated in last year's Stage 1 acquisition of the network, have participated in the Stage 2 acquisition of the 'Mixed' cable networks.
The upgrade of Telenet's network to a 2-way digital standard, is complete with up to half a million telephony and high speed internet RGUs paying an average of E48 per month for Telephony and E42 per month for high speed Internet.
Operationally, Telenet has made significant progress over the last year. A new management structure has been consolidated around Callahan-appointed CEO, Duco Sickinghe. Financially the company passed an important milestone, turning EBITDA positive early in 2002.
Callahan continues strong local partnership with significant local investors including GIMV and Electrabel.
Cable services are provided through 16 municipalities within the Flanders Region. The sale of the 'Mixed Intercommunales' cable networks represent 10 of these, covering 68% of households. The remainder will maintain their ownership.
Comments Richard Callahan, Founder and CEO of Callahan Associates: "At the worst ever moment in history for the cable sector, when many others world-wide are bust, we have achieved a major success. This agreement means that Telenet continues to be a strong, alternative provider to the national incumbent, Belgacom. I would like to thank all parties concerned, but especially, to praise the Belgian authorities for their enlightened support of competition. We hope that regulators in other parts of Europe will take note of the advantages presented by integration."
For further information please contact:
Callahan Associates International
Chris McLaughlin – Vice President, Public Relations
Direct: +44 207 318 8900
Mobile: +44 779 627 6033
Notes to Editors:
Telenet provides telephony, Internet and multimedia services to the Flanders region of Belgium, which represents nearly six million inhabitants, or 58 per cent. of the country's population. Telenet provides these services on an exclusive basis over the CATV networks of Flemish Intercommunales, which pass 2.5 million homes and have 2.2 million subscribers.
In the last six months, Telenet, in collaboration with the intercommunales, has substantially completed the upgrade of the network. This upgrade provides all customers with access to an advanced, hybrid fibre co-axial network; capable of delivering high speed Internet, broadband telephony, analog and future TV services through a single cable, to every home. This represents one of the highest levels of upgraded network anywhere in the world.
At May 2002, 207,000 telephone and 201,000 Internet lines were operational, with residential cable customers. A substantial proportion of these customers are now taking a fully-fledged Triple Play combination of Telephony, Broadband Internet and CATV from a single provider, Telenet (new figures to be released week commencing 19 August 2002).
The terms “Mixed” and “Pure” intermunicipalities refer to their shareholding structures. The “Mixed” include Electrabel as a shareholder, the “Pure” are exclusively owned by local municipalities.
Callahan Associates International, LLC is a global development and operations company focusing on the information, communications and entertainment markets. It is the managing partner in cable operations encompassing a total of more than 19 million franchise homes.
Cable Communications Businesses
Callahan Associates is one of the leading (based on the number of franchise homes) cable communications operators in Europe, serving more than 19 million franchise homes. Local companies in the Callahan group include ONO, Spain's largest (based on franchise homes) national cable operator, the North Rhine Westphalia regional cable operation in Germany, Ish (NRW) and Telenet.
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