Kabel Deutschland gains valuation boost

21 February 2013 | Kavit Majithia


Kabel Deutschland, presently subject to a possible Vodafone takeover, has had its value receive another boost after announcing a dividend jump of €2.50 a share.

Vodafone is reportedly in the market to acquire the cable provider, and since the news, Kabel Deutschland shares have gone up by 7%, with market capitalisation at €6.1 billion. It began in 2013 at €5 billion market capitalisation, and was only paying a dividend at €1.50 a share this time last year.

The Munich-based company has said it will bring forward network investments, and spend an extra €300 million over the next two years to speed up growth. It has also forecast an 8% rise in revenues for the year ending 31 March, to €1.8 billion.

Q3 revenues jumped sharply by 8.8% as a result of an increase in subscriptions, and the increasing uptake of internet and TV bundled subscriptions.

The European cable industry appears to be heading towards a trend of consolidation, with US company Liberty Global recently acquiring UK-based Virgin Media.