Liberty Global and Vodafone complete creation of Dutch joint venture
Posted by Nick Hill on 03 Jan 2017
Liberty Global and Vodafone have completed the creation of a joint venture called VodafoneZiggo Group Holding B.V.
The 50:50 Dutch operation will operate under both the Vodafone and Ziggo brands, creating a nationwide integrated communications provider with 7.1 million homes passed by the cable network of Ziggo and the nationwide 4G mobile coverage of Vodafone’s presence in the Dutch market.
VodafoneZiggo currently has combined revenue of more than €4bn with ten million fixed and five million mobile Revenue Generating Units.
The JV, first announced in February 2016, is valued at €3.5bn after deducting €7.3bn in debt held by Ziggo, the brand name of Liberty Global’s Dutch operation.
Liberty Global will receive around €2.2bn and Vodafone will get €0.6bn in a cash payments post closure.
VodafoneZiggo Group Holding B.V. is now a national enterprise business through the combination of Vodafone Netherlands’ B2B expertise, product portfolio and distribution footprint with Ziggo’s B2B operation and its nationwide cable network.
Mike Fries, CEO of Liberty Global, commented: "This joint venture is great news for Dutch consumers and businesses.
“VodafoneZiggo will be the most innovative provider of converged communications services in the Netherlands with a full suite of market-leading TV, broadband, fixed-line and mobile products on day one of the JV. We are also excited for our shareholders.
“This is a highly accretive transaction with significant synergies and a predictable dividend stream. When including over €500m of cash generated and up-streamed since the announcement of the deal back in February, total proceeds to Liberty will exceed €2.7bn. We look forward to deploying that capital to drive long-term growth and investor returns."
Vittorio Colao, Vodafone Group Chief Executive, said, "Today marks the creation of a strong integrated communications provider in the Netherlands, combining the complementary skills and experience of Vodafone and Liberty to bring a range of benefits to consumers, enterprises and the public sector.
“The merged operation will be a stronger competitor in the Netherlands - one of our core European markets - and is a further example of Vodafone’s ability to create value for its customers and shareholders through an effective market-by-market convergence strategy."
Liberty Global is the world’s largest international TV and broadband company, with operations in more than 30 countries across Europe, Latin America and the Caribbean.