Callahan Associates has finalised its acquisition of 54.2% of Telenet, for an undisclosed sum. The Belgian cable company, which is valued at euro1.8 billion, has also agreed to issue warrants giving Callahan Associates the right to increase its stake by a further 19.9%. Callahan Associates investment partners in the deal were Evercore Capital Partners LP, CDP Capital Communications (a subsidiary of Caisse de depot et placement du Quebec) and Merrill Lynch Ventures. Merrill Lynch, KBC Bank NV, JP Morgan and NIB provided financing. Merrill Lynch also acted as adviser to Callahan Associates.
Callahan Associates will partner with the existing shareholders to advance Telenet’s aggressive growth strategy. The company, which is based in Flanders, aims to improve and expand distribution channels, enhance customer support and offer new services, including advanced broadband services. Telenet also plans to launch IDTV (interactive digital TV) in the region in 2002.
US-based Callahan Associates is a global development and operations company focusing on the information, communications and entertainment markets. It is already the managing partner in cable operations in Germany, France, Spain and Portugal. The Telenet acquisition will bring the total number of franchise homes in Europe served by Callahan Associates to 22 million. Since its foundation, and including Telenet, the company has raised euro10 billion for investment in European broadband companies. The remaining 45.8% of shares in Telenet are held by GIMV (12.21% – see evcj February 2001, page 25), a consortium of local financial institutions (12.21%) and CATV inter-municipalities, owned by local municipalities and Electrabel (21.37%). Callahan Associates has also acquired a 53.5% interest in the cable TV assets of the inter-municipalities.