Grupo Corporativo Ono SA headquarters in Madrid, Spain.
Grupo Corporativo Ono SA headquarters in Madrid, Spain. (Angel Navarrete/Getty)

The battle for control of the European cable market heated up Monday with the announcement that British telecommunications giant Vodafone is buying Spain’s largest cable operator.

Vodafone has agreed to acquire Madrid-based Ono in a deal worth roughly $10 billion, including the assumption of more than $4.5 billion in debt. Ono, which bundles cable television services with broadband Internet and telephone packages, serves about 1.9 million customers in Spain. Vodafone expects that the deal will generate roughly $334 million in annual savings before integration costs, as well as an additional $1.4 billion in revenue.

The deal—which is expected to close in the third quarter, pending regulatory approval—comes less than a year after Vodafone paid $10.1 billion to acquire Kabel Deutschland, Germany’s largest cable operator, in an agreement that followed a months-long competition with rival bidder Liberty Global. Liberty, which is run by American billionaire John Malone, was also considering a bid for Ono, according to The Wall Street Journal. Liberty has indulged in its own European spending spree of late with a $9.4 billion deal for Dutch cable company Ziggo announced in January. Liberty also boasted one of last year’s largest acquisitions as its $23.3 billion purchase of Virgin Media last February gave Malone’s company a strong foothold in Vodafone’s backyard, the United Kingdom, while paving the way for further European expansion.

Meanwhile, Vodafone is well positioned for its own string of acquisitions after cashing out of its 45 percent stake in Verizon Wireless this past fall in a deal worth $130 billion. Vodafone CEO Vittorio Colao has said the company has as much as $40 billion in what he calls “spending power” and that the company has promised to spend $32 billion on network enhancements over the next two years, according to Bloomberg. Among Vodafone’s strategic options is also a looming takeover proposal from AT&T, which ruled out a deal in January but continues to be linked to its British counterpart.

DLA Piper is advising Vodafone on the purchase of Ono with a team led by Madrid-based corporate partner Juan Picon, the firm’s senior partner in Spain. According a press release issued by the firm, London-based senior corporate associate Ben Forgiel-Jenkins was Picon’s “right hand on the deal.” Competition partner José María Jimenez Laiglesia and financial markets partner Tony Lopez are also working on the deal, along with associate Luis Vegas and Santiago Lardies, an attorney the firm described in its press release as a legal director.

U.K. publication Legal Week reported in 2011 that DLA had won a first-time appointment to both of Vodafone’s legal panels, one of which is for the corporate group in general while the other is dedicated specifically to U.K. matters. The company has frequently turned to Magic Circle firm Linklaters on past transactions, including last year’s purchase of Kabel Deutschland and on the $11.3 billion sale of Vodafone’s 44 percent stake in French wireless service company SFR to Vivendi in 2011. Simpson Thacher & Bartlett took the lead for Vodafone on the Verizon Wireless deal last year, while Slaughter and May and Hogan Lovells also had roles for the company.

Weil, Gotshal & Manges is representing Ono’s majority shareholders—private equity firms Providence Equity Partners, CCMP Capital Advisors, Thomas H. Lee Partners and Quadrangle Capital Partners. The group, which owns a collective 54.4 percent stake in Ono, also turned to Weil Gotshal for legal advice on a 2010 refinancing of the Spanish company.

Weil Gotshal’s team advising the majority shareholders on Ono’s sale is led by London-based private equity partner Marco Compagnoni, who was assisted by associate Lewis Blakey. Antitrust partner Douglas Nave and tax of counsel Oliver Walker are also advising.

Ono is also receiving Spanish law advice from Madrid-based corporate partner Renata Mendaña Navarro of Spanish firm Garrigues, according to a Weil Gotshal press release.