Chinese energy and investment group CEFC has teamed up with Czech-Slovak financial group Penta Investments to try and buy Time Warner’s TVX.N Central European Media Enterprises (CETV.O), three sources familiar with the matter said.
One of the sources said privately-held CEFC is leading the consortium and is expected to provide the bulk of the financing for any deal to acquire CME, which could be worth about 500 million euros ($590 million). CME has over $1 billion in debt and a market capitalization of $623 million at Tuesday’s close.
The Nasdaq-listed television broadcaster and production company operates in six central and eastern European markets, with the Czech Republic and Romania being its biggest profit drivers.
Time Warner has a 46.5 percent voting share in CME but on a fully diluted basis the U.S. group has a 75 percent interest in CME, based on warrants exercisable until May 2018.
A potential sale has come into prospect since AT&T (T.N) agreed to take over Time Warner, agreed in October last year. Several bidders could be interested, including international players, another source said familiar with the matter said.
Penta declined to comment. It has already invested in print and online media in the Czech Republic and Slovakia.
A Time Warner spokesman declined to comment.
But CEFC, a rapidly growing oil and finance conglomerate with assets across the world, may face a challenge to get the deal done following Beijing’s recent clampdown on capital outflows in sectors such as media.
CME shares climbed over 7 percent in Prague on Wednesday and traded up 5.8 percent at 99 crowns at midday.
Source: Reuters
