International cable provider Liberty Global has agreed to acquire British cable provider Virgin Media for US$23.3 billion in stock and cash.
Once regulators and shareholders approve this deal, Liberty Global will receive Virgin Media's subscriber base of 4.9 billion, bringing the former's global customer count to 25 million across 14 countries.
Liberty Global is presumably adding a strong entity to its fold, as Virgin recently reported that it had a 2012 operating profit of US$1.1 billion, good for a 30% rise year-over-year. During that time, it also added 88,700 new cable customers.
"Adding Virgin Media to our large and growing European operations is a natural extension of the value creation strategy we've been successfully using for over seven years," reads a statement issued by Mike Fries, President and CEO of Liberty Global. "Virgin Media will add significant scale and a first-class management team in Europe's largest and most dynamic media and communications market. After the deal, roughly 80% of Liberty Global's revenue will come from just five attractive and strong countries: the UK, Germany, Belgium, Switzerland and the Netherlands."
"Like all of our strategic acquisitions we expect this combination to yield meaningful operating and capex synergies of approximately $180 million per year upon full integration," he continues. "But just as importantly, Virgin Media's market leading innovation and product expertise, particularly in mobile and B2B, will accelerate our own development of these business segments."
As for Virgin's main man Sir Richard Branson (pictured above), he will retain a three per cent stake in the company.