Bulgarian Buy Said to Boost CME 2010 Ebitda

bTV sale is the third large deal on the Bulgarian TV market for the last two years after the US Central European Media Enterprises bought the cable TV2 and Ring for EUR 110 M, and the Swedish MTG Group acquired Nova TV for EUR 620 M. File photo

Central European Media Enterprises Ltd., the east European television broadcaster partly owned by Time Warner Inc. expects the acquisition of Bulgarian TV station bTV to help it post positive full-year Ebitda.

The company aims to report “better” earnings in 2010 as it sold its Ukrainian operations and relies on a regional recovery.

“Assuming that we’ll close the deals in Ukraine and Bulgaria, which we’re aiming to do, all our operations will post positive full-year Ebitda,” Sarbu said in an interview for Bloomberg agency in the company’s headquarters in Prague.

“It is also a target for us to deliver better Ebitda than last year; we will do our best but everything depends on the markets.”

CME, which posted a net loss of million in the fourth quarter, will strive this year to post higher earnings before interest, taxes, depreciation and amortization across its operations, said Chief Executive Officer Adrian Sarbu.

The company on Feb. 24 reported fourth-quarter Ebitda fell to .1 million from .8 million in the same period a year earlier. After dropping Ukraine, it agreed to buy a Bulgarian station.

“Assuming that we’ll close the deals in Ukraine and Bulgaria, which we’re aiming to do, all our operations will post positive full-year Ebitda,” Sarbu said in a March 3 interview in the company’s headquarters in Prague.

“It is also a target for us to deliver better Ebitda than last year; we will do our best but everything depends on the markets.”

Central European Media, or CME as the company is known, signed a deal on February 18 for the acquisition of Bulgaria's first national private television bTV, wholly owned by Rupert Murdoch's News Corp.

Under the terms of the agreement, CME will pay USD 400 M in cash for 100% of the terrestrial free-to-air TV channel, bTV. It will also take control of the two genre channels, bTV Comedy and bTV Cinema, along with News Corporation’s 74-per-cent interest in Radio Company C.J which operates five radio stations.

This sale completes News Corporation's programme of exiting its substantial Eastern European free-to-air broadcasting businesses, the company said.

The transaction is subject to regulatory approval by the Bulgarian Commission for the Protection of Competition and other customary closing conditions.

The move follows CME selling its Ukrainian channels Studio 1+1 and Kino to local businessman Igor Kolomoisky for USD 300 M in January. That deal is expected to close in the second half of April.

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