GMT Communications Partners and Veronis Suhler Stevenson, private equity investors in the media and communications sector, have sold Pepcom to Star Capital Partners for an undisclosed sum.
Pepcom is Germany’s sixth-largest cable TV operator, with more than 630,000 subscribers of video, broadband and voice services.
Both GMT and VSS were the control investors in Pepcom, holding equal stakes in the company amounting to an 81 per cent interest, with the remaining 19 per cent in the hands of Pepcom’s senior management and other individual shareholders.
Under the terms of the agreement, senior management will rollover a substantial part of their proceeds into the new investment vehicle controlled by Star.
Set up as a platform investment designed to consolidate the fragmented German cable TV market, VSS and GMT built Pepcom through organic growth and the completion of 12 bolt-on acquisitions, targeting regional networks in small towns where a strong market position existed. These included the 2005 purchase of Kabelfernsehen München ServiCenter, a Bavarian cable TV and broadband operator which more than doubled Pepcom’s business.
Jeffrey Montgomery, managing partner of GMT, says: “Against the backdrop of the toughest macro-economic environment in memory, we are delighted with this exit, which will help Pepcom accelerate its plans for future growth.
“Pepcom is a great example of the investment opportunities available to investors with strong industry sector experience. Our deep understanding of the fragmented German cable TV market and our experience of the sector gave us the initial vision and subsequent commitment to build a consolidator that is now the sixth-largest operator in the main European market. We wish the team every success for the future.”
Legal advice on the transaction was provided by Noerr, Weil Gotshal & Manges, and Baker McKenzie. Deloitte served as a financial adviser.
