Once again, it looks like international cable company Liberty Global
About two weeks ago, the company agreed to sell its French cable assets, UPC France, for about $1.5 billion. That seems like a good price, roughly 11 times EBITDA, for a business in a mature, competitive, and not-so-fast-growing market. Not only is cable TV itself reasonably mature in France, but the market for broadband (a major growth outlet for many cable companies, including Liberty) is also highly competitive. Unlike some phone companies, France Telecom
Today, Liberty continued that trend -- announcing the long-expected sale of its UPC Sweden business. The price here wasn't quite so attractive, $427 million and about nine times EBITDA, but it's also a smaller and rather mature market. That said, it seems that many people were (before the company sold its Norwegian business, that is) expecting a sale at something like eight times EBITDA, so that's not all bad.
The company gave no specific plans for the cash it'll get from these sales, but I think it's a pretty safe bet that management's intentions will lie along the lines of getting into faster-growing emerging cable TV markets or further expanding its broadband opportunities, or both. Remember, this company is already the third-largest cable broadband owner.
The market of late has not been all that kind to cable companies. Liberty is down about 20% over the last six months, and Comcast
Note: There are three traded classes of Liberty Global shares -- LBTYA, LBTYB, and LBTYK.
For more related Foolishness:
- Profiting From Bucharest's Couch Potatoes
- Comcast's On-Demand Exercise
- Liberty Global's Give and Take
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Fool contributor Stephen Simpson has no financial interest in any stocks mentioned (that means he's neither long nor short the shares).