John Malone's Liberty Global in Talks to Acquire Caribbean Telecom Firm
A possible deal for Cable & Wireless would expand the international cable company's reach in the region and could be valued at $5 billion-plus.
John Malone’s Liberty Global said Thursday that it is in talks to acquire cable and telecom company Cable & Wireless Communications.
A possible deal would expand the international cable company's reach in the Caribbean and Panama. Cable & Wireless also operates in Monaco and the Seychelles, but is headquartered in the U.K. It has 6 million subscribers and offers pay TV, broadband and telephony services.
The deal could be worth more than $5 billion given that Cable & Wireless, whose stock is traded in London, had a market value of about $4 billion on Thursday, according to the Wall Street Journal. Including debt, a deal could be valued at roughly $8 billion, the paper said.
Cable & Wireless last year agreed to a $1.9 billion cash and stock deal for Columbus International, in which Malone owned a stake. The transaction give the mogul a 13 percent voting stake in Cable & Wireless.
"Liberty Global confirms that it is in discussions with the board of CWC regarding a possible offer for the entire issued and to be issued share capital of CWC," the company said on Thursday". This announcement does not amount to an announcement of a firm intention to make an offer."
The statement came after Cable & Wireless had issued a statement saying: "CWC is in discussions with Liberty Global plc regarding a possible shares and cash offer for CWC." It added: "There can be no certainty that any firm offer will be made nor as to the terms on which any firm offer might be made."
Liberty Global this year launched a tracking stock for its operations in Latin America and the Caribbean.
Macquarie analyst Amy Yong said in a report at the time that the tracking stock was an "emerging LatAm star" and said there were "lots of strategic options ahead." Among them are "growth through acquisitions and other partnerships," a combination with Malone’s stake in Cable & Wireless and a possible sale to a larger player, she said.