Liberty Global increases stake in Netherlands' cable operator Ziggo to 28.5%

US billionaire John Malone's European cable business Liberty Global has increased its stake in Ziggo from 12.65-per cent to 28.5-per cent.

The move comes barely three months after Liberty Global acquired a 12.65-per cent stake in the Ziggo for €632.5 million ($808 million).

Liberty Global, which also holds a controlling stake in Ziggo's rival UPC, bought 17.5 million shares through a hedging transaction related to a portion of the existing shares of Ziggo. The stake is worth $780 million based on Ziggo's Friday share price, taking its total investment to around $1.5 billion.

The purchase was financed through a loan linked to the hedging transaction that is secured by Ziggo shares, Liberty Global said in filing with the US securities regulator.

Under Dutch law, Liberty Global would be required to make a bid for the whole of Ziggo if it acquires more than 30 per cent.  Ziggo has a market capitalisation of €5.59 billion.

While buying into Ziggo in March, Liberty Global had said that the investment is an "attractive opportunity to make a strategic investment in a market where it already enjoys a sizable presence" through its own cable unit UPC - the second-largest cable provider in the Netherlands.

Ziggo is the largest cable operator in the Netherlands, providing cable television, internet, and telephone services to more than 4 million residential and commercial customers.

Liberty Global, formed through the 2005 merger of Liberty Media and UnitedGlobalCom, operates in 13 countries in Europe, and is the largest cable operator in Poland, Switzerland, Belgium, Austria, Slovakia, Hungary and Czech Republic.

Liberty Global's consumer brands include UPC, Unitymedia, Kabel BW, Telenet and VTR. It also has a 50-per cent stake in MGM Networks in the US through Europe-based Chellomedia.

Eighty per cent of its revenue comes from Europe, of which, two-thirds comes from four countries, Belgium, the Netherlands, Switzerland and Germany.

In terms of revenues, Telenet is Liberty's second-largest business after its European division UPC. With 18.4 million customers, Europe is Liberty Global's biggest market.

Last year it fully acquired Belgian peer Telenet Group Holding NV for $2.56 billion, and this year agreed to buy UK cable-television and internet provider Virgin Media for $15.75 billion.

This month, Liberty Global backed from a bidding war with Vodafone Plc for control of Germany's largest cable operator Kabel Deutschland, but is planning to sell its content subsidiary Chellomedia.