What is the latest on the controversial takeover of Central European Media Enterprises (CME) by the Czech Republic’s PPF Group?
CME’s most recent results, published earlier this week, say that it remains on track and should be completed before October 27. This will be exactly a year since the $2.1 billion deal was first announced.
Although CME points out that its sale has been approved by shareholders and already received regulatory approval in Romania and Slovenia, obstacles could still remain. Back in February, before the Covid-19 pandemic effectively brought the world to a standstill, US Senator Marco Rubio asked for it to be investigated by the Committee on Foreign Investments in the United States (CFIUS). In his view, such an investigation was warranted as CME is a subsidiary of a US company (AT&T) and its sale would undermine US national security interests in Central and Eastern Europe (CEE).
PPF Group stood accused of working on behalf of China, where it has significant investments, and helping spread its influence in CEE. This it strongly denied, arguing that it was only buying CME to complement its telecom business.
While we have since not heard anything about the proposed investigation, there have been other important developments related to PPF Group. According to Bloomberg, its owner Petr Kellner has effectively lost $2.5 billion so far this year due to the pandemic and the collapse in the value of his stake in the China-based but Dutch registered consumer lender Home Credit, now worth an estimated $2.8 billion. Kellner’s fortune nevertheless still stands at a healthy $10 billion and he is expected to recover his losses in the short to medium term.
As for the sale of CME, unless some last-minute political pressure is brought to bear, it still looks likely to be completed before the end of October.
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