AT&T announces sale of CME to Czech investment group

AT&T has agreed to sell broadcaster Central European Media Enterprises (CME) to PPF, an investment group owned by the Czech Republic’s wealthiest man Petr Kellner.

The deal is valued at US$2.1 billion, with AT&T to receive approximately US$1.1 billion in cash at close and be relieved of a US$575 million debt guarantee. 

CME was inherited by AT&T following its merger with Time Warner, and holds 75% of the company when factoring in preference shares. 

Kellner – worth US$15.4 billion and ranked 73rd on Forbes’ world billionaires list – has built PPF since the early 90s. The broadcaster joins PPF’s portfolio which includes O2 Czech Republic and is made up of assets exceeding €45 billion.

CME operates in five Central and Eastern European markets, broadcasting 30 television channels in Bulgaria (bTV, bTV Cinema, bTV Comedy, bTV Action, bTV Lady and Ring), the Czech Republic (Nova, Nova 2, Nova Cinema, Nova Sport 1, Nova Sport 2, Nova International, Nova Action and Nova Gold), Romania (PRO TV, PRO 2, PRO X, PRO GOLD, PRO CINEMA, PRO TV International and PRO TV Chisinau), the Slovak Republic (TV Markíza, Markíza International, Doma and Dajto) and Slovenia (POP TV, Kanal A, Brio, Oto and Kino). 

John Billock, chairman of the CME board of directors, said: “The special committee of the board, together with our advisors, conducted an extensive review of alternatives, which involved outreach to and engagement with a significant number of strategic and financial parties. This announcement today reaffirms our commitment to deliver value to all shareholders.”

In a joint statement, Michael Del Nin and Christoph Mainusch, co-chief executive officers of CME, said: “Over the course of the last six years, while transforming the business and delivering a continuous stretch of astonishing profitability growth, our primary focus has been on creating value for our owners. This transaction, which is the culmination of those efforts, is the right one for our shareholders and a satisfying conclusion to one of the most successful turnarounds of a leading media company in recent times. 

“We are pleased that the PPF Group, with a strong track record as operators of businesses across many industries, shares our perspective on the importance of local content and its ability to attract large audiences to television.”

The deal is expected to be completed in Q2 2020, following regulatory approvials and the satisfaction of customary closing conditions.