TBC offers cable television, high speed internet and cable telephony services through proprietary cable infrastructure which passes around one million homes in north and central Taiwan.
Macquarie Bank and Macquarie Media Group acquired TBC from private equity firm Carlyle in December 2005, but the announcement surrounding the latest sale of a 20% stake to one of Macquarie's funds is ambiguous about the identity of the seller.
Macquarie was not available for comment on the deal, but stated in its filing to the Singapore Exchange that the stake was being acquired from a ônon-Macquarie related financial investorö.
Carlyle sold the business to Macquarie in 2005 for a firm value of A$1.19 billion ($890 million). At the time, Carlyle had owned the company for six years, paying an estimated $200 million for the asset in 1999.
Macquarie Bank took 40% of TBCÆs equity for A$274 million, while Macquarie Media paid A$411 million for the remaining equity. The rest was debt funded. Both investors said at the time that they would sell-down to a lower level controlling shareholding in the near term.
TBC is the sole licensee and provider of cable TV services in the five franchise areas in which it operates. On March 31, 2007 TBC had 670,000 basic cable television, 95,000 high speed internet, 17,000 digital television and 14,000 voice over internet (VoIP) subscribers.
When Macquarie acquired TBC in December 2005 it said TBC had approximately 650,000 basic cable TV subscribers and 90,000 internet subscribers.
The price Macquarie International Infrastructure Fund (MIIF) is paying for its 20% stake represents a multiple of 12.2 times calendar 2006 earnings. The price suggests an equity value for TBC of $890 million.
MIIF is the flagship Asian listed infrastructure fund of the Macquarie Bank Group. It has investments in airports, communications infrastructure, utility and energy assets, water and gas distribution assets, transport infrastructure assets, aged care infrastructure assets and tank storage facilities, among others. The TBC investment will comprise around 15% of MIIFÆs portfolio based on a March 31, 2007 valuation, after taking into account the divestments announced in July.
MIIF was the first infrastructure fund to list on the main board of the Singapore Exchange in May 2005. It currently has a market capitalisation of more than S$1.5 billion ($987 million) and over 6,500 investors, both retail and institutional.
During the last week, MIIF has made both earnings and divestiture announcements. On July 6, the firm said it paid $3.1 million to its manager, Macquarie Infrastructure Management (Asia) Pty Limited (MIMAL), part of MacquarieÆs investment banking funds division, for the April 1 to June 30 quarter, during which period shareholder value increased by $12.8 million. This followed announcements on July 2 and 4 that MIIF had unwound some total return swap arrangements. The divestitures were consistent with MIIFÆs ongoing efforts to focus on Asia.
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