United Internet considers complete takeover of Versatel - CEO
FRANKFURT Aug 14 (Reuters) - German internet service provider United internet is mulling a complete takeover of cable group Versatel, in which it already owns a stake, Chief Executive Ralph Dommermuth said.
"This is an option we are considering," he told Reuters on Thursday. "It does not often happen that the second largest German fibre optic cable network comes on the block."
United Internet bought a 25 percent stake in Versatel for 60 million euros ($80 million) in 2012. Buyout group KKR owns the rest of the group, whose fibre optic cable network spans 33 of the 50 largest German cities and totals 53,000 kilometres.
KKR recently launched the sale of its stake and people familiar with the deal said that the asset may attract peers such as Vodafone or Telefonica Deutschland.
Incumbent Deutsche Telekom, however, is unlikely to bid for antitrust reasons, they added.
For United Internet the purchase of Versatel would result in a shift in strategy. Until now, United Internet has predominantly rented bandwith and resold it using its 1&1 or GMX brands but has not invested in a grid on its own.
In the first half of 2014, United Internet increased its earnings before interest, taxes, depreciation, and amortisation by 35 percent to 237.6 million euros, while sales rose 12 percent to 1.43 billion euros. (1 US dollar = 0.7463 euro) (Reporting by Peter Maushagen; writing by Arno Schuetze; Editing by Victoria Bryan)