This excerpt taken from the CTCM 8-K filed Mar 11, 2008.
CTC MEDIA TO ACQUIRE DTV GROUP
Moscow March 11, 2008 CTC Media, Inc. (NASDAQ: CTCM), Russias leading independent television broadcaster, announced today that it has entered into a definitive agreement to acquire DTV Group (DTV) from Modern Times Group MTG AB (MTG) for a total cash consideration of approximately $395 million. DTV Group operates a national free-to-air television network and a group of 28 owned-and-operated stations in Russia. CTC Media currently expects the transaction to close by the end of the second quarter 2008, subject to customary conditions to closing, including anti-monopoly clearance.
Alexander Rodnyansky, Chief Executive Officer of CTC Media, said, This is a fundamental breakthrough in the execution of our strategy to expand our broadcasting footprint and audience reach, and to capitalize on growth potential. DTV is a well-run, profitable and established network that will increase our exposure to the fast-growing Russian TV advertising market. Given its primary focus on male audience, DTV perfectly complements our existing brands: CTC with its young, dynamic audience and Domashny that targets female viewers. With the Russian television business facing continued fragmentation of the viewing audience by topical preferences, this transaction presents us with an excellent opportunity to offer our advertisers a broad multi-channel proposal and to capture a larger advertising market share as Russian media holdings continue to consolidate attractive media assets. We believe that major synergies from this transaction will come from content procurement optimization, efficient programming rights management, our value added expertise in TV brands management, and better leverage in advertising sales and distribution.
DTV has been owned and operated for a long time by MTG, one of Europes largest broadcasting companies, which is also one of our strategic stockholders and owns approximately 40% of our stock, continued Rodnyansky. We are very pleased that we have reached a mutual agreement with MTG on the acquisition, and value their continued commitment to developing CTC Media as the leading independent broadcasting company in Russia. We would also like to thank our Board of Directors and our other strategic shareholder Alfa Group for their assistance and support of CTC Media management in preparing this acquisition transaction.
Our managerial and personnel experience in building TV brands and operating successful TV networks provides an excellent base to make this new project another CTC Media success story. With a larger and more diversified portfolio of TV distribution assets, we are confident in our ability to generate higher returns for our shareholders well into the future.