The Japanese companies the KDDI Corporation and the Sumitomo Corporation on Wednesday offered to buy the remaining stake in the domestic cable operator Jupiter Telecommunications that they do not already own for a combined $2.7 billion.
Under the terms of the deal, KDDI and Sumitomo, which currently own around a 70 percent stake in the company, will offer Jupiter shareholders 110,000 yen ($1,378) for each of their shares in Japan's largest cable operator.
The offer represents a 33 percent premium on Jupiter's share price on Friday, when a potential deal was first reported. Shares of the Japanese company closed down 1.33 percent, at 111,200 yen, on Wednesday in Tokyo.
As part of the deal, KDDI รข€" one of Japan's largest mobile phone operators - and Sumitomo plan to operate the business as a joint venture in which both companies will own a 50 percent stake in the unit.
The Japanese companies said they would use Jupiter's dominant market share in the c ountry's cable industry to expand their own offerings, particularly on smart phones and other mobile devices. KDDI and Sumitomo said they would merge their separate cable operations upon completion of the deal.
KDDI, which currently owns a 30.7 stake in Jupiter, said it would acquire Jupiter shares worth around 71 billion yen. The mobile phone operator bought its initial stake in the cable company in 2010 after KDDI paid $4 billion to Liberty Global, the United States-based communications company controlled by John C. Malone, for the holding.
Sumitomo, which founded Jupiter in the mid-1990's, said it would create a separate unit with KDDI to buy a stake in the cable company worth a combined 145 billion yen. The Japanese conglomerate currently owns a 39.9 percent stake in Jupiter.
