Consolidation in Bulgarian Cable Market

STOCKHOLM: Private equity fund EQT V has acquired Eurocom and a majority stake in CableTel to create Bulgaria’s biggest cable operator, with the combined value of the two deals set at more than 200 million euros.

EQT V has purchased 100 percent of Eurocom from Warburg Pincus and 70 percent of CableTel from Gene Phillips. CableTel’s other shareholder, Ron Finley, will remain a minority shareholder in the merged company and is investing further equity. The merged platform aims to be a dominant player in the digital TV and broadband sectors in Bulgaria and Macedonia. EQT says the annual merged revenues would be about 70 million euros, with a combined 500,000 subscriber homes.

“We see great potential in the Bulgarian market as both digital TV and broadband are gaining ground fast," said Piotr Czapski, a partner at EQT Partners and advisor to EQT V. "With our strong experience in the industry, we believe that by working together with the new company and its management we can drive both growth and technical innovation in the sector which today is fragmented."

EQT previously developed Swedish cable TV operators StjärnTV and Com Hem into leading local providers of digital TV, broadband and telephony. It currently owns the German cable platform Kabel BW.

“To drive this development of both the merged company and the market as a whole investment is needed in the networks and the operations," said Istvan Polony, the CEO of Eurocom who will lead the combined company. "With the support and financial backing from EQT V and their strong experience in the industry we will be extremely well positioned to not only benefit from the development but also being a driving force. For the customers of Eurocom and CableTel this means new and attractive services at very competitive prices and first-class customer care.” Eurocom and CableTel will continue operating as separate market entities for the next few months.