Czech-Slovak financial group Penta Investments is striking a business alliance with the Chinese energy and investment group CEFC in a bid to buy the Central European Media Enterprises Ltd belonging to Time Warner Inc.
There have been reports that the privately-held CEFC is playing a lead role in the consortium. CEFC will be entrusted with the provision of the bulk of the financing towards the purchase deal of the CME, which could be approximately 500 million euros (£443.2 million).During Tuesday’s close, CME had a market capitalization of $623 million and about $1 billion (£754.4 million) in debt.
The Nasdaq-listed television broadcaster and production company takes great pride in the fact that it has succeeded at launching its operations in six eastern and central markets. The company’s spokesperson in his recent statement outlined that Romania and the Czech Republic for quite some time now have been its biggest profit drivers.
The U.S. group has a 46.5 percent voting share in CME. However, on a diluted basis it has 75 percent interest in CME and that is in close consideration of the warrants exercisable to May 2018.
It was in October that AT&T (T.N) finally made up its mind about the Time Warner takeover. It goes without saying that a potential sale is slowly coming into prospect. International players are part of the various bidders that might eventually express their interest in the deal.
A number of news reporters had moved out seeking to get Penta to crack up regarding the matter. To their utter disappointment, it declined to comment. At this particular moment, Penta has managed to make a series of investments in print and online media in Slovakia and the Czech Republic.
A short while back, CEFC proceeded to purchase a Prague office building from Penta. Asides from that, it also has a wide array of other Czech investments. Journalists moved out to get the CEFC spokeswoman to make comments in relation to the matter. To their utter disappointment she turned down their request.
CEFC is one of the rapidly growing oil and finance conglomerates and has massive assets around the globe. Sources indicate that it might be encountering several challenges on its quest to get the deal done following Beijing’s recent clampdown on capital outflows in sectors such as media.
A market analyst opined, “An acquisition by a Czech company would mark another step in the departure of foreign firms that had dominated the country’s media market for most of its post-Communist history.”