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FRANKFURT, July 16 (Reuters) - U.S. hedge fund Elliott hasfiled a suit with a Munich court demanding higher compensationfor minority shareholders in a squeeze-out of Kabel Deutschland by Vodafone, two people familiar with thematter told Reuters.
Vodafone secured just over three quarters of shares in KabelDeutschland, Germany's largest cable company, with a 7.7 billioneuro ($10.4 billion) takeover offer last year. The world'ssecond-largest mobile operator is seeking to expand its offeringof television and fixed-line services in Germany.
Sources told Reuters last September that hedge fundsincluding Elliott, Davidson Kempner and York Capital wereplanning legal action in hopes that a court would force Vodafoneto offer a higher price at the next stage of the buyout.
On Thursday, the two people familiar with the matter toldReuters that Elliott was demanding between 225 euros and 275euros per share of Kabel Deutschland, roughly three times asmuch as the 84.53 euros in cash that Vodafone had offered.
A spokeswoman for a Munich regional court confirmed that thetakeover of Kabel Deutschland by Vodafone was subject to legalproceedings but declined to provide details or say who had filedthe lawsuit.
Vodafone, Kabel Deutschland and Elliott all declined tocomment on the matter.
Monthly Manager Magazin had reported on the matter earlier,saying Elliott now held 13.5 percent of shares in KabelDeutschland.
Elliott has sued for higher compensation as a minorityshareholder in takeovers in the past - a strategy dubbed"playing the back end".
($1 = 0.7392 Euros) (Reporting by Arno Schuetze and Peter Maushagen; Writing byMaria Sheahan and Kirsti Knolle; Editing by Catherine Evans)
