Are you sure?

Providence Equity Partners moves on emerging Europe

Communications-focused buyout firm Providence Equity Partners has invested $200 million (€136 million) in a Ukrainian cable company in the country’s largest private equity transaction – reports Financial News.

Providence has invested in Volia Cable, its second investment in an emerging European telecoms company, following a $150 million acquisition of 40% of Turkish pay-TV operator Digiturk in 2005. US-based private equity fund SigmaBleyzer, which invests in former soviet countries and Eastern Europe, including the Ukraine, Romania, Bulgaria and Kazakhstan, retained an undisclosed stake in Volia Cable.

SigmaBleyzer, which has been investing in the region for more than a decade, created Volia through the consolidation of four separate companies acquired between 1999 and 2000 plus additional investment in a fiber optic network. Volia now provides cable telecommunications and broadband internet services across the Ukraine. In total Providence has invested in seven companies operating in the cable and telecommunications sectors across Europe, including Kabel Deutschland, which provides cable services in Northern Germany. Michael Bleyzer, president and chief executive of Sigma Bleyzer, said: “It is our belief that attracting the highest quality global investors like Providence will have a positive effect on the Ukrainian economy and investment climate and will further promote the Ukraine as an important investment destination.” In 2001 Bleyzer set up the Bleyzer Foundation, an economic think tank which analyzes the effects of foreign direct investment and private equity on emerging markets.

Unlike Advent International, which opened an office in the capital, Kiev, Providence does not have a permanent office in the Ukraine. Advent became one of the first international private equity groups to set up an office in the Ukraine in September, run by Tamás Nagy, former dealmaker for Hungary, Bulgaria and the Czech Republic. Other investors in the region include Euroventures Ukraine and Western NIS Enterprise Fund, which tend to target smaller deals than Advent or Providence, as well as Horizon Capital, which sold ceramic brick maker Slobozhanska Budivelna Keramika in 2002 for $13.5 million, or two and a half times its money. (