KDDI and Sumitomo Make A Joint Bid For Jupiter Telecommunications

Posted Oct 24, 2012

Japanese companies KDDI Corporation and Sumitomo have made a joint bid of $2.7 billion to acquire Jupiter Telecommunications.  KDDI and Sumitomo own around 70% of Jupiter, which is the largest cable operator in Japan.  They will offer Jupiter shareholders 110,000 yen ($1,378) for each of their shares.  This is 33% above Jupiter’s share price as of Friday when the deal was initially reported.

KDDI is one of the largest mobile phone operator companies in Japan and Sumitomo plans to operate the business as a joint venture.  Each company would have a 50% stake in the combined company.  The two companies would use Jupiter’s dominant position in the domestic cable industry to expand their own offerings like smartphones and mobile devices.  KDDI and Sumitomo said they would merge their separate cable operations after the deal is completed.

KDDI already owns a 30.7% stake in Jupiter and would acquire Jupiter shares worth around 71 billion yen.  KDDI paid $4 billion to Liberty Global in 2010 for their initial stake in Jupiter.

Sumitomo founded Jupiter in the 1990s and they would create a separate unit with KDDI to buy a stake in the cable company worth a combined 145 billion yen.  Sumitomo owns 39.9% of Jupiter.

[New York Times]