Candover exits triple play

Robert Venes

Candover has largely exited its holding in Get, a ‘triple play’ Norwegian provider of cable broadband, internet and telephone. It was previously known as UPC Norway when it was acquired by Candover in early 2006.

The sale to rival private equity houses Quadrangle Capital Partners and Goldman Sachs Capital Partners for NOK5.8bn (€743.8m) generated an internal rate of return of 50% and a 2.2 times money multiple on the original €445m acquisition.

With an investment horizon of just over eighteen months the exit borders on ‘quick flip’ territory, but Candover has kept a stake in Get, with staple financing from advisor Merrill Lynch, suggesting it sees further value generation from the sector. It isn’t alone. The secondary sale – a ‘safer’ bet in tight markets – is just the latest in a number of private equity forays into the sector in the last few years.

Goldman Sachs Capital Partners has already invested in the sector, having partnered with Apax Partners and Providence Equity Partners in March 2003 to buy German cable TV operator Kabel Deutschland from Deutsche Telekom for €1.7bn. Apax and Goldman Sachs sold their stakes to Providence in December 2005 in a transaction valuing the enterprise at €3.2bn (with the former two apparently receiving €250m each, a 4x multiple on their investment).

Rhode Island-based Providence Equity Partners has also been involved in two of the sector’s other largest private equity investments: the €1bn purchase of Com Hem, a Swedish triple play business, by Providence and Carlyle from Nordic buyout group EQT for €1bn in December 2005; and TDC, a Danish telecom business. Providence, Apax Partners, The Blackstone Group, Kohlberg Kravis Roberts and Permira eventually bought TDC for €13bn, Europe’s largest buyout until Alliance Boots was acquired for £11.1bn earlier this year.