MONTREAL – Cogeco Cable Inc. has sold its troubled Portuguese subsidiary for just over $59 million and will focus on growth at home and paying down the Montreal-based cable company‘s debt, CEO Louis Audet said Wednesday.
“We think exiting Portugal at this time is the right thing to do,” Audet said in an interview. “We’re not envisaging buying companies outside Canada.”
The Montreal cable TV operator sold its Cabovisao – Televisao por Cabo S.A. for 45 million euros, or $59.3 million to European-based telecom investor Altice.
The money will be used to pay down Cogeco Cable’s (TSX:CCA) roughly $1 billion in debt, Audet said.
The sale ends several years of difficulties for the European cable operation which was hurt by a weak Portuguese economy and tough competition in that country.
The sale was long expected since Cogeco Cable wrote off its entire investment in the Portuguese company last summer. Cogeco had to vigorously defend its customer base at Cabovisao, which it bought in 2006 for about $600 million.
Portugal’s debt-ridden economy has been sluggish for years and with unemployment rising, Cogeco’s cable customers in the country have either cut back or opted out of service.
Audet said Cogeco will pursue large business customers with network and data services. That’s a market where it is a smaller player up against larger rivals Bell (TSX:BCE) and Telus (TSX:T).
“We think it’s a very attractive market segment.”
The company will continue looking for acquisitions, Audet said, noting recent acquisitions of Montreal-based MTO Telecom, Quebec-based Corus radio stations and the telecom division of Toronto Hydro.
Speculation increased late last year that Cogeco would sell its European operations when the vice-president and general manager of Cabovisao told local media that he saw consolidation in the Portuguese market.
Audet said the Portuguese cable operation was a regional competitor that had
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