The joint CEOs of Central European Media Enterprises (CME) have dismissed reports that the company may be sold to the PPF Group.
In a wide-ranging interview in the Czech publication HN, Michael del Nin said: “There are always a lot of speculations about the media market, probably more than in any other business. We do not comment on them, firstly, because there are an awful lot of them and it would only be a waste of time, and secondly because a number of them are simply complete nonsense. That said, the recent rumour you are referring to has been particularly persistent, so it might be worth addressing. The speculation you are mentioning is completely untrue. I can say that we are not conducting any negotiations for the sale of the company; we plan to be here for a long time”.
Christoph Mainusch added: “Our strategy is to focus on and improve our broadcasting business, and once this assignment is completed, we want to further develop this company. We can then launch new channels or expand to new markets. Why should we sell TV Nova? This wouldn’t fit within this strategy at all”.
Del Nin continued: “TV Nova is the heart of this company; it was its most profitable part for a long time and we hope that it will be again. I cannot imagine CME without TV Nova”.
When discussing the sale of CME’s non-TV assets, del Nin said that Bontonfilm in the Czech Republic would be disposed of soon. Otherwise, most other sold assets will be in Romania.
Regarding channels, Mainusch said: “Generally speaking, we continuously review our channel portfolio; there may be more of them, and there may be less of them. In regards to the Czech Republic, we are not planning to discontinue the broadcasting of any of our channels now. Nor are we planning to launch a new channel because, as I have said, we have to consolidate our company first of all. The channel portfolio remains as it is.”
Commenting on Voyo, he added: “Voyo is a very good example why decentralization was necessary. Earlier, Voyo was managed centrally. Every country in which we operate is different and, hence, the digital landscape is different. Voyo is one of the main pillars of our digital strategy, but it is not the only pillar. This is why we have presented our so called ‘catch-up service’ Nova Plus in the Czech Republic, where audiences will have an opportunity to watch the programs they missed on television for a full week after their initial broadcast. We will also do something like this in other countries. It is turning out that the two concepts can work together; since its launch, we have not registered Nova Plus cannibalising Voyo in any marked way.”
Regarding CME’s financial difficulties and the help it has received from Time Warner, Del Nin said: “The transaction we did was complicated, but extremely effective. We were able to do it in large part because of the support of Time Warner. To put it simply, we are refinancing our most expensive debt that required us to pay tens of millions of dollars in cash interest every year. We have replaced it with new debt, which Time Warner and other shareholders have provided to us and which is more expensive but relieves us of the need to pay interest in cash. If circumstances permit, it can be refinanced on better terms before it matures. To a considerable extent, this has resolved our problems with cash flows and should make it possible for us to generate positive cash flow next year. Under the terms of the transaction we undertook, Time Warner’s equity stake in CME has increased.”
