Vodafone eyes Kabel Deutschland deal

Vodafone has confirmed that it is holding preliminary discussions about a possible acquisition of German cable group Kabel Deutschland. UK-based Vodafone stressed that there is “no certainty that any offer will ultimately be made nor as to the terms on which any such offer might be made”.

The acquisition has been rumoured for some time and Emeka Obiodu, principal analyst for telco strategy at  Ovum said the prospective deal has won attention because of the diversification from Vodafone’s core mobile offering that it represents.

“It used to be fairly straightforward to predict what Vodafone would do. It wanted to be big, and was a buyer of assets rather than a seller. It also didn’t do fixed telecoms, TV, or cable,” Obiodo said.

“However, under its current management, Vodafone’s actions are less ideological and the group has made significant efforts to adapt to changes in the industry. The group’s mobile-only mantra has been shelved and its infrastructure-light strategy for fixed telecoms has been rethought.”

Obiodu added that, if it does acquire Kabel Deutschland, Vodafone will become the largest TV provider in Germany, which is the operator’s largest market.

“Vodafone’s pragmatism provides further evidence that European telcos are now in survival mode and that anything that helps them to overcome the challenges they face is fair game.”

Vodafone already offers TV services as part of a triple-play offering in the Netherlands and Portugal.