US Media Giant Acquires Stake in Bulgarian TV Channels
The US media giant Time Warner Inc. (TWX) has agreed Monday to purchase a 31% stake in Central European Media Enterprises Ltd. (CETV) for USD 241,5 M.
CETV bought two Bulgarian television channels in 2008 - TV2 and the only sport broadcasting channel in Bulgaria, Ring TV.
Time Warner, plans to invest in the broadcast company as it looks to boost its presence in Central and Eastern Europe. That is an area widely viewed as a growth market for media before its economies were derailed by the global financial crisis, The Wall Street Journal commented.
For its investment, Time Warner will receive 19 million newly issued Central European Media shares. Shares of Time Warner rose 1,5% to USD 7,98, while Central European Media shares jumped 30% to USD 13,02.
Under the deal, Time Warner agreed to allow Central European Media founder and nonexecutive chairman Ronald S. Lauder to vote its shares for at least four years. Time Warner also will appoint two people to Central European Media's board.
The transaction, subject to approvals by regulators and Central European Media shareholders, is expected to close before midyear.
The two companies also formed a partnership to operate new television channels, some of which will carry the Warner Bros. brand, in CME territories. The channels will feature international films and TV series.
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