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LONDON (Reuters) - Private equity owners of Numericable have asked banks to pitch on a possible stock exchange listing this year that could value the French cable company at around 4 billion euros ($5.3 billion), three people with knowledge of the plan said.
The funds - Cinven, Carlyle and Altice Group - have invited about 10 banks to submit proposals in May and they will likely pick three of them to work on a share sale, the sources said.
If the sale goes ahead this would be a further sign of investor interest in European cable operators as they take broadband market share from traditional telecom companies.
Dutch cable group Ziggo ZIGGO.AS drew strong demand for its listing last year and Europe's biggest cable operator Liberty Global (LBTYA.O) in February agreed a deal to buy Britain's Virgin Media VMED.O for $15.8 billion.
Also, a rise in global stock markets has already encouraged a string of companies to go public this year. The amount raised by volume of new listings in Europe is up 49 percent on the same period last year.
The share sale would provide an exit for Numericable's private equity owner Cinven, while another fund Carlyle and Altice's owner cable entrepreneur Patrick Drahi might decide to keep their stakes, the people said.
Private equity firms raise money from investors to buy businesses hoping to sell them later at a profit.
Numericable and Altice were not available for comment. Carlyle and Cinven, which each own about 35 percent of the company, declined to comment.
"This <the listing> is one the options currently on the table", said one of the sources who asked not to be named because the talks are private.
Another option would be a long-touted merger with French fixed and mobile player SFR, which Numericable's owners believe would create significant cost savings, the sources said.
"For Carlyle, the best option remains a merger with SFR so they'll stay on board only if the listing is compatible with an SFR deal," said one person familiar with the matter.
Last year, Numericable held talks with Vivendi over a tie-up, but they foundered over valuation issues and deal structure.
Vivendi decided at a December board meeting that the timing was wrong to exit SFR because of turmoil in the French telecom market created by a new low-cost mobile player. Vivendi's largest shareholder Vincent Bollore, who took 5 percent of the company last year and a seat on the board in December, drove that decision, the people said.
Numericable is the only cable operator in France, and it covers roughly one-third of households, offering packages of pay-TV, Internet and fixed calls starting at 24.90 euros a month.
It also has a unit called Completel, which sells high-speed broadband to corporate clients.
Including Completel, Numericable could be worth 4-5 billion euros based on 8 times 2011 core profit of 602 millions euros.
Excluding Completel, Numericable's sales grew 1.1 percent last year to 874 million euros, while earnings before interest, tax, depreciation and amortization rose 4.6 percent to 456 million euros.
Additional reporting by Leila Abboud in Paris and Kylie MacLellan in London; Editing by Alexander Smith, Louise Heavens and Jane Merriman