Tele Columbus AG, Germany’s third-largest cable-television operator, agreed to buy PrimaCom Holding GmbH for 711 million euros ($778 million) to gain users and expand its network.
The combination will bring together 2.8 million homes and is expected to be completed July 31, Tele Columbus said Thursday. PrimaCom, the No. 4 German cable operator, owns a fiber network providing telecommunications and TV services to 1.2 million homes.
Tele Columbus, which serves about 1.7 million households primarily in eastern Germany, is seeking to add clout as Europe’s cable and telecommunications market consolidates. The company said in January it planned to raise at least 300 million euros to refinance debt as rivals Vodafone Group Plc and Liberty Global Plc expand fixed-line networks.
Tele Columbus shares rose 2.9 percent to 13 euros at 9:24 a.m. in Frankfurt, giving the company a market value of 737 million euros. They had added 26 percent this year through Wednesday.
Liberty Global, controlled by billionaire John Malone, has spent more than $50 billion amassing cable and television assets in Europe over the past decade, while Vodafone has added TV and Internet operations through deals in Germany and Spain.
In 2013, an attempt by Tele Columbus to sell itself to larger competitor Kabel Deutschland Holding AG, now controlled by Vodafone, was stymied when regulators opposed consolidation in Germany’s cable market.
The PrimaCom deal will be financed through a combination of cash on the balance sheet, a fully underwritten debt package and a 125 million euro bridge loan, the company said.
Tele Columbus said the transaction doesn’t need regulatory approval and isn’t subject to merger control review.