LONDON/MADRID Feb 10 Britain's Vodafone
has made an offer to buy Spain's largest cable operator Ono from
its private-equity owners ahead of a board meeting of the
Spanish company on Tuesday, two people familiar with the
Other sources familiar with the matter have told Reuters
that Ono, which sells fixed and mobile phone, TV and internet
services, believes it has an enterprise value of at least 7
billion euros ($9.5 billion).
Vodafone and Ono declined to comment on Monday. The private
equity owners of the group could not immediately be reached for
Ono's owners had been planning an initial public offering
this year in a bid to capitalise on a wave of investor interest
in the increasingly successful cable sector.
But the owners may now consider a straight sale as U.S.
cable firm Liberty Global has also expressed an
interest in recent weeks.
The two sources also said they believed this was Vodafone's
second offer, after the first was rejected.
Vodafone has been acquiring broadband assets to allow it to
offer bundled services to consumers and offload traffic from its
Investment funds Providence Equity Partners, Thomas H. Lee
Partners, CCMP Capital Advisors, and Quadrangle Capital own 54
percent of Ono, according to the company's website.
Spokesmen for Providence and CCMP declined to comment on
Monday. Thomas H. Lee and Quadrangle could not immediately be
reached for comment.
ONO has 13 board members, but the funds that control 54
percent of the company only hold 5 seats so they would have to
convince at least another two board members to back a deal.
Liberty Global, owned by billionaire John Malone, has been
on a spending spree to increase the size of its empire in
Europe, where it derives more than 90 percent of its revenue.
It bought Britain's Virgin Media for $15.8 billion last
year, and has agreed to pay 10 billion euros ($13.7 billion) for
Dutch cable operator Ziggo after months of
Spain is one of the few European countries, along with
France, where Liberty is not already present.
The cable sector trades on an enterprise value to 2013 core
profit (EBITDA) multiple of 9.4 times, according to Reuters
Ono had core earnings of 752 million euros for 2012, which
at the sector multiple of 9.4 times would give an enterprise
value of 7.1 billion euros.
A source familiar with the situation earlier told Reuters
that any buyer would have to pay 10 to 12 times operating profit
if it hoped to preempt the IPO that was being prepared in