Liberty Global Revamps Businesses - Analyst Blog

Liberty Global plc. LBTYA, a leading cable TV operator in Europe and Latin America, has acquired the remaining 20% stake in VTR, the largest cable operator in Chile.

The company purchased the outstanding shares of both VTR GlobalCom SpA and VTR Wireless SpA from a subsidiary of Corp Group Holding Inversiones Limitada after issuing 10.1 million of its own Class C ordinary shares. The total consideration was approximately $422 million.

Liberty Global is trying to extensively penetrate into the European region with its bundled video, voice and Internet (data) services. In Jan 2014, Bloomberg reported that the company may consider a decision to spin off its Latin American operations.

Liberty Global's Latin American operations include VTR Internet and wireless businesses in Chile and its 60% share in Liberty Cablevision of Puerto Rico.

Recently, Liberty Global terminated its negotiations to acquire British IT group, Daisy. Daisy sells telecoms services especially in the business-to-business segment. The deal was annulled after Daisy demanded more than GBP 500 million, which Liberty Global considered pricey.

Recently, Bloomberg also reported that Liberty Global intends to establish a pan-European mobile virtual network operator (MVNO) system to provide mobile phone services. MVNO is a company which uses the established network infrastructure of an existing wireless operator to offer its own services.

The service will be provided across Europe, especially in the Netherlands, Belgium, Switzerland, Austria and the U.K. Consequently, the company will become a competitor to major wireless operators such as Vodafone Group plc. VOD,  Deutsche Telekom, Royal KPN N.V. and Belgacon.

Currently, Liberty Global is in the process of acquiringa 100% stake in Ziggo N.V., the largest cable TV operator in the Netherlands. At present, Liberty Global holds a 28.5% stake in Ziggo. The deal is expected to close by the second half of 2014, subject to regulatory approvals.

Liberty Global is also trying to acquire full control of Belgian cable TV operator Telenet Group Holding NV. Currently, the company holds a 58.4% stake in Telenet.

In Jun 2013, Liberty Global acquired a 100% stake in British cable MSO Virgin Media. In the U.K., the merged entity poses a serious competitive threat to British Sky Broadcasting Group plc and BT Group plc. BT.

British Sky Broadcasting Group is the largest pay-TV operator in the U.K. and is partially controlled by News Corp. NWSA. Currently, Liberty Global carries a Zacks Rank #3 (Hold).