Malone seeks to renegotiate DT deal
Liberty topper to cut cash Deutsche Telekom will receive
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On Friday, the Financial Times Deutschland reported that Liberty chief John Malone wanted to renegotiate the 5 billion euro ($4.3 billion) deal to which the parties agreed in a letter of intent signed in February.
Malone intends to cut the amount of cash DT will receive -- set at 50% of the price, according to the original deal.It would be bad news for Deutsche Telekom if the sale, due to close July 1, faltered. Company has already included the $4.3 billion expected from the Liberty deal in its current year figures. DT was expecting $9 billion-$12 billion from the sale of assets this year.
With Liberty's Dutch subsidiary UPC having generated net losses of about $1.7 billion last year, the company is tightening its belt. In February, Liberty injected some $750 million into UPC.
Industry watchers say it's a good time for Malone to play his hand: Deutsche Telekom is hard up for cash, and with the cable market on a downturn, finding new investors won't be easy.
The cable sale promises to be a highlight at the DT shareholders' meeting Thursday.
