Telecity acquires Redbus

Actually 3i who own Telecity aquired Redbus for 23p a share a 16.5% premium on the closing price valuing Redbus at £58.9m, a far cry from what Redbus was valued in the dotcom boom. This puts Redbus' share price at 23 times their EBITDA.

Telecity were running out of space and rather than building new facilities, just buy the competetion's space by buying them.

This is further evidence that the Internet/Telecoms market is still in majr consolidation mode which will continue for quite some time until there are a few big players left who can genuinely compete with each other.

Telecoms industry in a poor state still

O2 is going to Telefonica, OneTel is up for sale (it seems Centrica who have been faffing around for the last few years have made a decision to actually sell them) the asking price seems to be £350m, but Carphone Warehouse who may have been approached as a buyer rejected it as much too high. Carphone Warehouse have now decided to go into LLU (local loop unbundling), though a good move, it's further emphasises the need for a shared infrastructure to compete with BT's 21CN.

Tele2 are pulling out of the UK too.

Who's next?

BBC NEWS | Business | Telefonica buys UK's O2 for �18bn

BBC NEWS | Business | Telefonica buys UK's O2 for �18bn

Telefonica has offered £17.7bn ($31.6bn) which works out at 200 pence per share, a 22% premium on Friday's closing price of 164.25p.

Since BT demerged O2 theyhave been looking for a buyer. Since Telelonica has no infrastructure or competing services in the UK this is a good match for both, but another example of consolidation which is the industry norm now.