Nature of Business
Blue Interactive is the largest independent cable operator in Brazil, providing TV and broadband services in mid-sized cities where there is high pent-up demand. The company was established in 2009 by Marcelo Lacerda, Silvia de Jesus and Sérgio Pretto as an acquisition platform in the rapidly growing pay TV and broadband markets. Blue has successfully grown its footprint from 14 cities in 2009 to 25 cities in nine states in 2013.
We invested in Blue for a significant minority stake in July 2012. We backed a highly respected management team with expertise in the telecommunications sector and substantial M&A experience, which is critical in a sector where scale is a differentiating factor.
Going forward, Blue is looking to build clusters of cable operations in mid-size cities, which are markets currently overlooked by the large operators. In addition, the company aims to continue growing its penetration levels in cities in which it currently operates; expand its network into other mid-sized cities where cable TV is currently unavailable; and execute value-accretive, opportunistic acquisitions that can accelerate Blue’s growth and add scale.
Through our Active Partnership approach, we identified c.50 initiatives related to operational improvements, strategic planning and improved governance, most of which have been completed. Through our Business Leader Network, we introduced Richard Alden as Chairman. Richard brings considerable experience from his time as CEO of ONO, a leading cable operator in Spain.
Since 3i’s investment in 2012, the number of subscribers has grown by over 50% and is expected to reach 300,000 by 2016.
Regulatory notice: This transaction involved a recommendation of 3i Investments plc, advised by 3i Brazil.