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Liberty Global Inc. (LBTYA - Analyst Report), a leading cable MSO of Europe and Latin America, recently increased its stake in its Belgian subsidiary, Telenet to 58.4% from its existing 50.2% stake. Last September, Liberty Global decided to acquire the remaining 50% stake of Telenet for approximately $2.6 billion. In December 2013, the company launched a cash offer for Telenet's shares and securities through its subsidiary Binan Investments B.V.

Recently, Liberty Global declared that 9,497,637 ordinary shares and 3,000 warrants of Telenet were tendered under its cash offer. As a result, Liberty Global will get more voting rights in Telenet. Management stated that it is closely monitoring the organization, governance and reporting structure of Telenet and may opt for more integrated option.

Telenet is an integrated telecom company offering television, broadband and mobile phone services in the Dutch-speaking north Belgium. In the third quarter of 2012, Telenet generated $461 million of revenue for Liberty Global and it had 2.134 million subscribers. At present, Liberty Global is concentrating solely on Europe and some parts of Latin America. From early 2010, Liberty Global is gradually concentrating on strengthening its foothold in Europe through a series of mergers and acquisitions.

In the coming years, we believe Liberty Global’s revenue will continue to benefit from a ‘triple play’ of video, broadband, and telephone, as it signs up more “bundled” customers in Europe and Latin America. Deployment of high-speed DOCSIS 3.0 network has facilitated the company to be at par with Virgin Media Inc. and BT Group plc. (BT - Snapshot Report).

We maintain our long-term Neutral recommendation on Liberty Global. Currently, it enjoys a short-term Zacks Rank #3 (Hold).

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