NATO Secretary General Mark Rutte to Visit Bulgaria Amid Strengthened Defense Efforts
NATO Secretary General Mark Rutte will visit Bulgaria on December 19, 2024, as announced by the Ministry of Defense
bTV already belongs to the Czech billionaire Petr Kellner, and the new owner of BTC is negotiating to buy Nova.
If both deals are completed, the combination of telecom with media will dominate in Bulgaria.
The sales can change the advertising and television market, including the quality of content.
One of the biggest transformations on the Bulgarian television, advertising and telecom market is about to happen in the coming weeks. This Tuesday, the new owner of bTV and the main channels in four more countries - the fund of the Czech businessman Petr Kellner PPF, came into possession of the Bulgarian television. He also owns one of the three major telecoms here after buying Telenor's local business two years ago. Thus, one of the two major private national televisions became part of a group that included one of the major telecoms. However, this may not be all.
According to several independent Capital sources, a sale of Nova Broadcasting Group, Bulgaria's largest media group, is currently under way, which includes TV channels around Nova TV and the digital business around Netinfo. The company is currently owned by brothers Kiril and Georgi Domuschiev. The sale procedure started at the beginning of the summer, and due diligence is currently being carried out in Nova Broadcasting Group. Capital sources say the main candidate in the negotiations is United Group (UG), which became BTC's owner in the summer. In recent years, the company has acquired telecoms and televisions mainly in the countries of the former Yugoslavia. The majority shareholder in it is the London-based investment fund BC Partners, and the minority shareholders are its founder - the Serbian businessman Dragan Solak, the American fund KKR and the EBRD.
The fact that UG is negotiating with the Domuschiev brothers, of course, does not mean that it will necessarily become the owner of Nova. Although the discussions are progressing so far, there are stages in which the price of the possible deal should be discussed. But a solution is expected before the end of the year.
UG's interest in the Bulgarian media group is no surprise. In all other countries where it is present, the company also has content distributors - cable and satellite providers, and media. Prior to the investment in Bulgaria, all the company's efforts were concentrated in the countries of the former Yugoslavia. "UG is one of perhaps the only two global operators to not only distribute content, but also produce and maintain it. As such, the company has great potential for development. The other is Comcast, which recently bought Sky and has the same model as United Group. "said Nikos Statopoulos, CEO of BC Partners, in an interview with Capital a year ago.
The integration between a content producer and a distributor is probably one of the reasons why Peter Kellner’s fund bought the American SME, the parent company of bTV, recently. PPF's telecommunications division has a strong presence (besides in Bulgaria) in the Czech Republic, Slovakia, Hungary, Serbia and Montenegro. After the completion of the SME deal, it will now have televisions in three of these countries. Kellner's company is not the most open and the strategic goal of these investments is not disclosed publicly. The fact is, however, that he persistently pursues this goal. Immediately after entering Bulgaria, PPF tried to buy Nova Broadcasting Group, but then the government prevented it from doing so. After Kellner refused to include Kiril Domuschiev as his partner, the CPC blocked the deal. Thus, in the end, Nova was bought by a Bulgarian businessman close to the government. However, Kellner did not give up and now becomes the owner of bTV through a deal that Boyko Borissov cannot stop through the regulators he controls - it was approved by the European Commission's Competition Directorate in Brussels.
On Tuesday, the new owner of CME announced who will run the televisions in the five countries where it operates. For a large part of the Bulgarian market, it was somewhat surprising that Didier Stoessel, who in recent years (until the purchase by the Domuschiev brothers) managed Nova TV and was a minority shareholder, was appointed CEO of the media company. He will be responsible for television in all countries except Bulgaria. The Czech Ljuboš Jetmar, who until a month ago managed the second largest television group in the Czech Republic, was presented here this week. The surprising thing is not so much that Didier Stossel is going to run all the televisions, as that he will not be responsible for Bulgaria. During his time here, he managed to fit in quite well with the local business style and managed to turn Nova into the largest Bulgarian media company. While in charge of the television, the host of the morning show Ani Tsolova was fired from there after a direct threat from Delyan Peevski, broadcasted by another MRF MP - Yordan Tsonev. Again during the time of Didier Stoessel, the company signed a large contract with the "National Lottery" of Vasil Bozhkov.
The suspension of lottery money (after the investigations against Vasil Bozhkov and the attempts to arrest him) may be one of the reasons why Kiril Domuschiev is trying to sell Nova. After the expulsion of the gambling businessman and the nationalization of this business at the beginning of the year, the television's income from this activity disappeared and this puts it in an awkward position. From Dubai, Vasil Bozhkov announced a "memorandum" by which he undertook to give BGN 20 million a year for advertising on Nova TV, and in return Kiril Domuschiev to provide him with "full support" at the Ministry of Finance ( and the Gambling Commission, respectively), so that the lottery business is taxed at a favourable rate.
The Domuschiev brothers bought the media group around Nova at a relatively high price - 185m Euros, or almost 9 times the profit before interest, taxes, depreciation and amortization (EBITDA). The assessment was similar in the deal for the package of televisions in the region, now bought by Kellner.
After the expulsion of Vasil Bozhkov at the beginning of the year, Nova was at least BGN 20 million back, and separately the coronavirus crisis hit the advertising market hard. The Bulgarian Association of Communication Agencies predicts that this year the televisions will have 13% less advertising revenue.
For these two reasons, the reported operating income of BGN 210 million and operating profit of BGN 64 million last year (coming after an unusually high other operating income of BGN 17 million, for which the explanations are cut from the report) seem unattainable. However, these numbers are from the individual report and do not include the recently acquired entirely internet group "Netinfo". And this year the prices of the paid sports channels were slightly increased. But this cannot compensate for the "lottery" 20 million a year, which came as a net profit. It will not compensate with a small part of what was lost. Therefore, the forecasts are that the price may now approach what Domuschiev paid in the spring of last year. In fact, for the brothers, the first monetization is already a fact - in the beginning of 2020 they withdrew a dividend of BGN 39 million from Nova TV.
Of course, the purchase of Nova TV by Kiril and Georgi Domuschievi had not only business but also political logic. In the week after they came under media scrutiny, full control of news and current affairs began to be imposed, so that they became a convenient channel for government propaganda. The proximity to the government is evident from the inclusion in the group of "Nova" of the close to Delyan Peevski "Channel 3" - a deal that from a commercial point of view is completely meaningless.
Why Domuschiev is now looking for a way out of Nova TV is not publicly known. "Nova Broadcasting Group has no practice of commenting on rumors," the company said in response to Capital's questions.
However, if the largest Bulgarian media company becomes the property of UG, this together with the deal for bTV will cause a serious shift in several markets. Advertising will probably be severely affected. The two telecoms are currently among the largest advertisers, and the acquisition of a media will certainly change their strategies. The TV market will also change - the new owners will have different priorities for the content of the different channels. Attempts to achieve synergies between telecom and television are likely to lead to an increased supply of new content delivery models. "The request is in the direction of integrity and exclusivity of the content between the media and the telecom. That is, if the media produces its own content, the probability of Telenor subscribers to have exclusive access to it through a platform, application or another is high," said Svetlana Tacheva, Director of Research in "Publicis Groupe Bulgaria". According to her, after the finalization of the deal by PPF we can expect in 2021 that Vivacom will withdraw from bTV as an advertiser. "This is happening this year with A1 Bulgaria, which as at September have withdrawn all their advertising investments from bTV and are significantly increasing their presence in NBG," she said.
This is just one example of the change that occurs only when bTV changes ownership. The effect of a possible deal with Nova would be even more serious.
Originally posted by Capital.bg
Remote work has become one of the most important trends in recent years.
It’s well known that online gambling has been regulated differently across the globe, but the cultural differences are not the only aspects responsible for this.
Winemakers are increasingly focusing on producing wines with lower alcohol content and fewer calories to meet the demands of health-conscious consumers
Over the past 15 years, Bulgaria has seen the disappearance of 401,871 farms, as reported by Prof. Bozhidar Ivanov, director of the Institute of Agrarian Economics at the Agricultural Academy of Sofia
Over 152 million counterfeit items, valued at approximately €3.
Bulgaria is set to request protective measures from the European Commission regarding the import of Ukrainian honey
Bulgaria Ranks Second in the Balkans at Paris 2024 Olympics, 26th Overall
Bulgaria Leads Europe in Heat-Related Deaths in Record-Breaking 2023