Liberty Global: The share price pays for the cash, Ziggo comes free
Five parts, one price: at €6.90 the share covers only cash and the investment portfolio. The market values the Ziggo Group at almost zero.
On 13 October, Liberty Global disclosed what Vodafone's 10% stake in the Ziggo Group is worth: €479.9m [4]. Scaled up to the 90% that Liberty Global holds, that is €12.66 per LBTYA share. The share itself closed at €6.90 on 16 October [10].
This is a short version of my main analysis. I skip the detailed calculations and show only which parts the holding consists of, how they connect and which part is currently driving the share price.
Liberty Global consists of five parts that are largely separated financially. At a share price of €6.90, the market pays almost exactly for the holding's cash and the investment portfolio, after the usual holding discount. The Ziggo Group, the most valuable single part, is therefore free on paper. The reason is fear of the British joint venture VMO2, whose bonds have fallen to distressed levels. My base case remains $15.75, or €13.80 per share. Rating: EventDriven, the catalyst is the Ziggo listing in mid-2027.
This is the short version. The full derivation of all component values, the scenarios and the Greenblatt spin-off screen are in the main analysis “Liberty Global: The Malone flywheel now hinges on Ziggo”. Liberty Global passed all three tests there: forced sellers, insider ownership by Malone and Fries, hidden value.
1. Five parts, three of which carry the value
Each part plays its own role for the share price. Ziggo, Growth and cash carry the value; I set VMO2 and VM Ireland at zero. The values come from my model, converted at $1.1414 per € [3]:
| Part | Role | Value per share (base, before holding discount) | Effect on the share price |
|---|---|---|---|
| Ziggo Group (90%, NL + BE) | Value driver | €8.72 | Listing in mid-2027 makes the value visible |
| Liberty Growth (~70 investments) | Disposal reserve | €7.33 | Every sale fills the cash pile |
| Holding cash (net) | Buffer | €1.20 | Keeps the debt-free holding able to act |
| VMO2 (50%, UK) | Option | €0 | Currently sets the mood |
| Virgin Media Ireland (100%) | Remainder | €0 | Little influence |
Ziggo on management's deleveraging path with a 20% safety haircut (€2,975m), Growth at its fair value of $2,852m [3], net cash after the Vodafone purchase price ($468.7m), VMO2 and VM Ireland on their debt with no equity value [2], each ÷ 341.09m shares [1]. The sum of the parts × 0.8 holding discount gives the base case of €13.80. Derivation in the main analysis. [own back-of-the-envelope calculation]
2. Separate credit silos: the subsidiaries are not liable for each other
I do not read Liberty Global as a conglomerate in the usual sense, but as a holding company sitting on top of separate credit silos. Four rules explain almost everything:
- The subsidiaries are not liable for each other. Ziggo, VMO2 and VM Ireland each finance themselves. If one part fails, the holding loses that part's equity, but no more capital than it chooses to inject.
- Money only flows up if the loan agreements allow it. VodafoneZiggo expects to breach its agreed leverage limit next year. Distributions to the parent are then blocked [4]. The proceeds from the sale of the Dutch towers therefore go into debt repayment, not into the holding's cash [5].
- The holding lives on disposals, not on operations. Its own free cash flow was −$153m in the first half [3]. Cash arises when Growth investments are sold or subsidiaries pay out.
- Value is realised through spin-offs. Liberty Global pays no dividend. The route to shareholders runs through buybacks and spin-offs: Sunrise in 2024 [8], the Ziggo Group in mid-2027 [5].
3. VMO2 sits at zero and still sets the share price
In my model VMO2 stands at zero, yet the joint venture is weighing on the share price. Since early October, the British joint venture's bonds have fallen to distressed levels [6]:
- Trigger: The UK Competition and Markets Authority (CMA) provisionally considers the acquisition of the fibre network Netomnia anti-competitive [7]. Relief of around £1bn for VMO2 depended on it [6]. The final decision is due by 15 December 2026 [7].
- Bonds: A vendor financing note maturing in 2033 fell to 37.7 cents on the dollar on 9 October [6].
- Debt capacity: Traders at Morgan Stanley consider only around £14bn of debt sustainable; around £22bn is outstanding [6].
For the holding this means: in the bond market's view, too, the VMO2 equity is worth nothing. It cannot fall below that. The holding can, however, lose in three other places:
- Distributions from VMO2 disappear.
- Fees for technology and central services are renegotiated in a restructuring.
- Liberty Global voluntarily injects capital to keep the position.
My reading of the share price: the market is pricing in one of these possibilities, or it fears that the VMO2 crisis will make the Ziggo Group's financing more expensive before the listing.
4. The market pays only for cash and investments
For the simplest cross-check, I calculate only with the two parts that need no forecast: cash and the Growth portfolio.
| Step | €m | per share |
|---|---|---|
| Holding cash, net ($468.7m) | 410.6 | €1.20 |
| + Liberty Growth ($2,852m) [3] | 2,498.7 | €7.33 |
| = Cash + Growth | 2,909.3 | €8.53 |
| × 0.8 holding discount | 2,327.5 | €6.82 |
| Market cap at €6.90 | 2,353.5 | €6.90 |
Calculation: (cash + Growth) ÷ 1.1414 × 0.8 ÷ 341.09m shares; market cap = €6.90 × 341.09m shares [1][3][10]. [own back-of-the-envelope calculation]
Between €6.82 and €6.90 there are 8 cents. That is all the market pays for the Ziggo Group, VMO2 and VM Ireland combined. Vodafone, by contrast, valued its Ziggo stake at €12.66 per LBTYA share [4].
“Anyone buying LBTYA today pays for the cash and the investment portfolio. The Ziggo Group comes free on paper.”
I accept two objections. The fair value of the Growth portfolio is a management estimate, not a market price. And the holding burns cash as long as no disposals succeed. Both justify a discount, but in my view hardly one that wipes out the Ziggo value entirely.
5. Ziggo: the part everything hinges on
For the Ziggo Group I now see three valuation points that mark out the range:
- Floor €2.40 per share: today's balance sheet at 6.0x EBITDA, without any deleveraging ($936m, main analysis).
- Base case €8.72 per share: management's deleveraging path to 4.5x by 2028 [3], with a 20% safety haircut.
- Vodafone anchor €12.66 per share: the value at which Vodafone's stake is recognised in the purchase price allocation [4].
Since the main analysis, the following speaks in favour:
- The EU has cleared the sale of the towers for €669m; closing is planned by year-end [5].
- VodafoneZiggo reports revenue growth for the third quarter and the best broadband net adds since 2019 [5]. So far this is a management statement; the figures follow on 3 November [5].
- Around €2.25bn of VodafoneZiggo's floating-rate debt is swapped into a fixed 1.20% until January 2029 [4]. The ECB hike only hits this portion after that.
Against it:
- The covenant warning from section 2 [4].
- The goodwill headroom at VodafoneZiggo is only €1.1bn. Cost of capital just 0.6 percentage points higher would trigger an impairment [4]. That costs no cash, but would be bad news ahead of the listing.
Briefly noted
Sunrise as a precedent. Anyone who held LBTYA before the Sunrise spin-off in November 2024 received one Sunrise share for every five shares [8]. Including the Sunrise share price and dividends, that position is roughly at zero after two years. The value went to the Sunrise share; the remaining holding lost. [own back-of-the-envelope calculation]
Share classes. Vodafone already holds its Ziggo stake in Class B shares [4]. What the share classes will look like at the listing is open. For the valuation I consider this secondary.
Tax. So far, the Ziggo spin-off is planned to be tax-free only for US shareholders [9]. The treatment in Germany is open.
Dates. 23 Oct deadline for submissions on the CMA review [7], 3 Nov Q3 results [5], 15 Dec final CMA decision [7], mid-2027 Ziggo listing [5].
- All component values come from the model as of 30 September 2026 in the main analysis; only the share price and new events have been updated.
- Conversion throughout at $1.1414 per € (end of June [3]); the current exchange rate differs.
- That Liberty Global is not liable for VMO2 debt rests on the structure of separate credit silos; I have not re-checked the guarantee disclosures in the 10-Q for this article.
- The Vodafone anchor is a preliminary estimate from the purchase price allocation, determined using an income approach [4].
- The 20% holding discount is my own assumption.
Conclusion
At its core, Liberty Global is simple: a cash pile, an investment portfolio, a valuable Benelux business and a British problem. The share price of €6.90 covers the first two parts and nothing else.
My thesis therefore hinges on one question: will Liberty Global, if necessary, let VMO2 go through a restructuring without fresh money while the Ziggo Group stays on its deleveraging path? If so, the discount is too large. The first answers come on 3 November, the decisive one with the Ziggo listing in mid-2027. For new positions, I consider a maximum of 3–5% of the portfolio reasonable.
Update log
- 25 Oct 2026 — Editorial revision: headings as statements, consistent first-person voice, series callout with the Greenblatt screen from the main analysis, note on the holding discount in the component table, English version. Figures, price basis, base case and rating unchanged.
- 17 Oct 2026 — First published as a short version of the main analysis. Component values and base case ($15.75) unchanged from the model as of 30 September 2026; new are the price basis of €6.90, the Vodafone valuation anchor from the 8-K/A, the tower clearance and the drop in VMO2 bonds.
Sources
- Liberty Global Ltd., Form 10-Q for the quarter ended 30 June 2026, SEC, Accession 0001570585-26-000109. Share count (176,722,235 A, 12,968,658 B, 151,396,673 C), holdco cash $1,610.1m. → https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0001570585&type=10-Q
- Liberty Global Ltd., “Liberty Global Reports Q2 2026 Results”, press release, 24 July 2026. Credit reports VMO2 and VodafoneZiggo. → https://libertyglobal.gcs-web.com/news-releases/news-release-details/liberty-global-reports-q2-2026-results
- Liberty Global, Q2 2026 Investor Call Presentation, 24 July 2026. Growth fair value $2,852m, EUR/USD exchange rate 1.1414, holdco adjusted FCF H1 −$153m, target leverage of 4.5x in 2028. → https://www.libertyglobal.com/wp-content/uploads/2026/07/Liberty-Global-Ltd-Q2-2026-Investor-Call-Presentation.pdf
- Liberty Global Ltd., Form 8-K/A (Amendment No. 1), SEC, filed 13 October 2026. Ex. 99.3: fair value of Vodafone's 10% stake €479.9m; Ex. 99.1: covenant note (Note 16e), goodwill headroom €1.1bn (Note 9), interest rate swap €2,250m at 1.20% until January 2029 (Note 20), Class B shares to Vodafone (Ex. 99.3). → https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0001570585&type=8-K
- Liberty Global Ltd., Form 8-K with press release “VodafoneZiggo Receives EU Commission Clearance for Tower Sale”, 14 October 2026, Accession 0001570585-26-000139. Clearance, €669m, closing by year-end, proceeds for deleveraging, Q3 statements by VodafoneZiggo, listing in mid-2027, Q3 results on 3 November 2026. → https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0001570585&type=8-K
- Bloomberg reports on VMO2 bonds, summarised by Briefs, 9 October and 12 October 2026. Bond prices, relief of around £1bn from Netomnia, Morgan Stanley assessment. → https://www.briefs.co/?p=25116 → https://www.briefs.co/?p=25468
- Competition and Markets Authority, Interim Report Notice nexfibre/Substantial, 2 October 2026. Deadlines 16 October, 23 October and 15 December 2026. → https://assets.publishing.service.gov.uk/media/6abf3cfc26660e5f62a7f278/_Interim_reportnotice.pdf
- Liberty Global Ltd., Form 8-K “Liberty Global Announces Completion of Sunrise Spin-Off Transaction”, 8 November 2024. Distribution of 1 Sunrise Class A ADS per 5 LG Class A and Class C shares. → https://www.sec.gov/Archives/edgar/data/1570585/000157058524000317/ex991-libertyglobalannounc.htm
- Liberty Global Ltd., “Liberty Global Completes Buyout of VodafoneZiggo as it Prepares for 2027 Ziggo Group Listing”, press release, 3 August 2026. 90% of the Ziggo Group, tax neutrality for US shareholders. → https://libertyglobal.gcs-web.com/news-releases/news-release-details/liberty-global-completes-buyout-vodafoneziggo-it-prepares-2027
- Market data: LBTYA share price €6.90 (close, 16 October 2026).