Private equity firm Providence Equity Partners is thought to be considering listing German cable TV operator Kabel Deutschland on a stock exchange, abandoning its plan of a €1bn (£882m) sale to a buy-out firm.
The listing could lead to a higher valuation of the company than an outright sale. Providence, which owns 88 per cent of Kabel Deutschland, is understood to be optimistic it will succeed with the listing.
It plans to generate €1bn from the sale, which it will start preparing in the coming days. Initial offers worth as much as €5.5bn were beset by financing problems, said one investment banker. Junk bonds would play a crucial role in the deal, so the sharp increase in financing costs for them poses a major obstacle.
At least four private equity houses -- Advent, Carlyle, Bain Capital and a consortium of CVC Partners and BC Partners -- had bid between €5bn and €5.5bn for Kabel Deutschland.