Russia may shortly see one of the biggest ever deals in its TV industry, with the National Media Group (NMG) buying the 25.3% stake in CTC Media currently controlled by Alfa Group. CTC Media is also backed by Modern Times Group (MTG), which would have to approve the offer from NMG.
According to Kommersant, NMG, which is controlled by Rossiya Bank, has offered a total of $1.071 billion (€722.5 million), equivalent to $29.097 per share for over 39.5 million shares, to Alfa Group.
Its offer, which is valid until May 25, nevertheless has to be considered by MTG as there is a shareholder’s agreement in place between MTG and Alfa Group. Valid until June 2014, it says that the maximum stakes Alfa Group and MTG can hold in CTC Media are 30% and 40% respectively.
Furthermore, if either party wishes to leave the business then the other has the first right of redemption.
MTG currently holds a 38.3% stake in CTC Media, with the remaining 36.4% of shares a free float.
Unnamed sources say that talks between NMG and Alfa Group have been going on since the beginning of the year and could be closed within a month.
CTC Media operates the TV stations CTC, Domashny and DTV in Russia, while NMG’s interests include 70% of Ren TV, 50.19% of Channel Five and 25% of Channel One, Russia’s leading broadcaster.
