Tele Columbus secures equity injection

Source: Tele Columbus

German cable operator Tele Columbus has secured an equity injection from main shareholder Morgan Stanley Infrastructure Partners to the tune of €300 million and has secured an agreement with its major creditors to provide €1.1 billion worth of financing at par until 2028.

Morgan Stanley Infrastructure Partners will provide €300 million of equity including shareholder loans that have already been made since the early part of the summer.

“This milestone enables Tele Columbus to consistently advance the successful expansion of its fibre optic network. We will now tackle this together with our partners in the housing industry and in the interests of all our customers,” said Markus Oswald, CEO of Tele Columbus.

Reporting Q3 financials, Tele Columbus said it had grown its broadband base by 7%, with a third of the 10,000 customers signing up in the quarter taking 400Mbps services or above.

The operator, which markets services under the PŸUR brand, said that it now reached 2.1 million homes with Gigabit services, including 270,000 households recently upgraded in Munich.

Tele Columbus lost 7,000 TV customers in the quarter, a lower number than in the prior year, and signed up the same number of customers to its premium TV products. A new hybrid PŸUR TV service was soft-launched in the course of the quarter.

With a TV decline offsetting growth in broadband, revenue for the first nine months of the year was flat at €333 million. Adjusted EBITDA for the third quarter grew by 5.2% to €49 million.

Tele Columbus said the equity injection and agreement with creditors would provide the company with significant capital, improve its balance sheet and maturity of debts.

It said the additional €300 million from Morgan Stanley Infrastructure Partners would be used entirely to support the transformation of its business model.

The equity injection and rearrangement of loans comes after ratings agency Fitch marked down Tele Columbus after it missed an interest payment on its €650 million of senior secured notes due on November 2.