Britain’s Vodafone Group agreed to a nearly $23 billion deal to buy operations in four European countries from John Malone’s Liberty Global a merger that would create one of the continent’s biggest telecommunications carriers. Wall Street Journal reported that Liberty Global,
the world’s biggest international cable company, will sell its businesses in Germany, Hungary, Romania and the Czech Republic to Vodafone, the world’s second-largest wireless carrier by subscribers behind China Mobile Ltd.
The deal, which is valued at €19 billion ($22.5 billion) and would give Liberty Global €10.6 billion in cash, would face a possibly lengthy European Union antitrust review. If completed, the merger would create a continental giant selling the industry’s holy grail “quad-play” package: cable, internet, wireless and landline-phone service on a single bill.
The deal would represent the latest in a global trend of wireless carriers acquiring cable operations, or vice versa, to offer quad-play packages, according to experts.
Wireless carriers need high-speed cable networks to quickly transmit data to cellular towers for 5G, the coming generation of mobile networks that promise to be fast enough to enable near-instantaneous movie downloads and innovations such as self-driving cars.
Vodafone said combining the companies’ operations would generate cost savings of about $632.80 million a year before integration costs by the fifth year after the deal completes.
It will target revenue synergies of more than $1.8 billion by cross-selling multiple services to the combined customer base.
