Antitrust authority to examine takeover of kabel deutschland

The head of the german federal cartel office, andreas mundt, stressed in bonn on wednesday that takeovers in the german cable market require intensive scrutiny. It remains to be seen whether this investigation will be conducted by the bonn authority or at EU level.

In the past, too, the antitrust authorities have always kept a close eye on the cable market. Most recently, they threw a spanner in the works of kabel deutschland and prevented the takeover of the smaller berlin-based provider tele columbus.

The acquisition of unitymedia and kabelbw and the subsequent merger of the two providers to become number two on the german market by the U.S. Cable giant was also only permitted by the authority under strict conditions.

And whether they weren’t even too lax is currently being examined by the dusseldorf higher regional court. Deutsche telekom had filed an appeal against the approval of the merger – and the senate responsible for the matter said on wednesday that it had serious doubts about the legality of the approval. The verdict is expected on 12. July will be announced – and was allowed to be followed very closely at vodafone and kabel deutschland.

The cable market is primarily regionally divided. Market leader kabel deutschland is active in 13 countries and has around 8.5 million households on its customer list. Unitymedia kabelbw is number two behind it and offers its services to baden-wurttemberg, hesse and north rhine-westphalia.

Followed with some distance by tele columbus. The network is a legacy of deutsche bundespost. The state-owned company built it, later it went to deutsche telekom. The latter finally had to part with it for competitive reasons.

In the meantime, the cable companies themselves are competing with their former parent, especially with so-called triple-play offers, i.E. Packages comprising television, internet and telephony. This is precisely what makes kabel deutschland a strategic target for vodafone: a takeover would be a frontal attack on deutsche telekom.

Liberty global has also expressed interest in a takeover. According to the court, however, there is essentially only one supplier left in this country, which is another reason why the antitrust authorities were allowed to see much higher hurdles here.

Mundt emphasized that, measured in terms of revenue, a takeover of kabel deutschland by vodafone as well as by liberty would be a case for the european antitrust authorities.

However, it is possible to apply for a referral to the federal cartel office. Mundt is not sure whether he wants to take on such an appeal. Vodafone made a takeover offer to kabel deutschland on monday. The munichers advise their stockholders to accept. The brits are prepared to put up to 10.7 billion euros on the table for the group.

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