Group Bids $12 Billion for TDC of Denmark

A group of private equity firms is offering about $12 billion in cash for Denmark’s largest telecom operator, TDC, and the company’s board recommended that shareholders accept the deal, which would be the second-biggest leveraged buyout ever.

The announcement Wednesday came after months of speculation that several private equity groups were interested in buying TDC, which provides local and long-distance service, Internet access and cellphone service in Denmark and elsewhere in Europe.

The suitor is a group that includes Apax Partners, Permira Advisors, Blackstone Group, Kohlberg Kravis Roberts & Co. and Providence Equity Partners Inc. The price would be second only to Kohlberg Kravis Roberts’ $25-billion deal that took RJR Nabisco Inc. private in 1989 after a celebrated takeover battle, according to investment research firm Thomson Financial. Those values each exclude assumed debt.

“We have received an offer and we believe it was so attractive that we have presented it to the shareholders,” TDC Chairman Thorleif Krarup said.

The group is offering 76 billion kroner for TDC’s shares, or 382 kroner ($60) a share. That is a 5.5% premium over TDC’s closing price Tuesday and more than 60% higher than the share price at the beginning of the year.

In addition to what it is paying for TDC’s stock, the consortium offered to buy back TDC’s outstanding bonds at face value, giving investors a healthy premium and raising the deal’s total value to about $15.6 billion.

The board’s recommendation doesn’t preclude it from entering discussions with other potential buyers, the Copenhagen-based company said.