Telia to acquire TV4, C More owner Bonnier Broadcasting for SEK 9.2 billion

News Video Sweden 20 JUL 2018
Telia to acquire TV4, C More owner Bonnier Broadcasting for SEK 9.2 billion

Telia Company has confirmed an agreement to acquire Bonnier Broadcasting, including its Swedish channels TV4 and C More and the Finnish MTV, for SEK 9.2 billion. The company first announced they were in talks in May, and the deal is the latest to see telecom operators merging with content providers. 

The deal values Bonnier Broadcasting at 15.4x its EBIT in the 12 months to March, or 7.7x if the expected synergies from the merger are included. Telia expects annual synergies of SEK 600 million by 2022, with the first positive effects to kick in from 2020.

The takeover underlines the growing importance of video, as well as the Nordic region, in the operator's strategy. Telia already counts 1.8 million TV subscribers and last year bought exclusive rights to the Finnish ice hockey League. Bonnier will help Telia strengthen its video offering and develop new services to meet quickly growing demand for VoD and streaming. 

Telia will establish a new business area to house its existing TV business and the Bonnier Broadcasting businesses.  Casten Almqvist, the CEO of Bonnier Broadcasting, will become CEO of the new business area.

Securing regulatory approval is expected to take a year, with the acquisition closing in the second half of 2019. The purchase price excludes cash and debt, and the agreement allows for an additional payment of up to SEK 1 billion based on future revenues and EBITDA. 

Bonnier Broadcasting will add around 1,200 employees at Telia, as well as annual revenues of SEK 7.5 billion and EBIT of SEK 600 million. The company's operating free cash flow amounted to SEK 300 million in the year to March, and this is expected to grow to a net contribution of SEK 500 million at Telia in 2020. Telia said the acquisition would not affect its ongoing share buyback, despite also just announcing the NOK 21 billion takeover of Get TDC.

Categories:

Video,  Internet

Companies:

Telia,  MTV,  See Telecom,  Bonnier,  C More

Countries:

Finland,  Sweden

Tags:

M&A buyouts & divestments

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