Casema urges merger of cable firms
21 February 2005 , AMSTERDAM — Cable company Casema wants to team up with its rivals UPC and Essent to ensure its survival in tightly-regulated market.
21 February 2005
AMSTERDAM — Cable company Casema wants to team up with its rivals UPC and Essent to ensure its survival in tightly-regulated market.
Casema has 1.4 million subscribers, concentrated around The Hague, Utrecht, Armersfoort and Breda. UPC has 2.3 million households and offices signed up, making it the largest dedicated cable company in the Netherlands.
Essent has more customers, namely 2.6 million households, but is also an energy company, news service NOS reported on Monday.
Casema director Jos Molenkamp is frustrated that his cable, internet and television company cannot operate on a nationwide basis due to rigid regulations. This is in contrast to the fact the telephone and internet service providers can operate right across the country.
He told newspaper Het Financieele Dagblad that a merger with UPC and Essent would allow Casema to operate in every region of the Netherlands.
US investment companies Carlyle Group and Providence Equity Partners — which bought Casema in 2003 together with British firm GMY Communications — are pressuring for a change in regulations.
Both companies are keen to see a solid financial return on their investment by a stock exchange listing or an eventual sale of the company.
Molenkamp said competition in the communication sector was no longer about the services on one network, but the battle between the networks of various providers. It means that companies are now offering internet, telephone and television in one package.
No merger talks with UPC and Essent are currently being held, but UPC is not averse to a fusion if the price is right. Essent doubts the necessity of the plan and is not keen to discuss the matter via the media prior to reaching its own conclusions.
Dutch competition watchdog NMa rejected the planned takeover of Casema by UPC owner Liberty Media in 2002, but Molenkamp believes the cable industry has changed sufficiently since then to allow such a merger to go ahead.
This is due primarily to the fact that more firms other than cable companies have discovered television as a source of income. Dutch telecoms firm KPN has launched itself in TV via Digitenne and Versatel wants to offer football via ADSL.
Molenkamp said the takeover of Casema by a telecoms firm — such as KPN, Belgacom or the BT Group — was a possibility if a merger in the Dutch cable industry did not proceed.
[Copyright Expatica News 2005]
Subject: Dutch news