Lauders’s CME acquired Adrian Sârbu’s radio assets

April 17, 2008 on 3:35 pm | by Iulian Comanescu | In Radio |

Central European Media Enterprises (CME) announced today the take-over of Compania de Radio Pro SRL, owned by one of the “big five” on the Romanian media market, Adrian Sârbu, for 20,6 million US dollars (47,2 million RON or 14 million euros). Compania de Radio Pro includes two radios: Info Pro (news) and Pro FM (contemporary hits, with several recently launched spinoffs - Dance, Alternative, Black, Love). Launched in 1993, Pro FM delivered in 2007 revenues of 3,3 million euros, with an EBITDA margin of 42%. Info Pro entered the FM spectrum in 2004 and had 0,6 mllion euros revenues in 2007, with an EBITDA loss of 1,0 million.

CME is Adrian Sârbu’s traditional partner and currently holds 95% of the TV businesses run by Sârbu, with a leading position on the Romanian market (Pro TV, Acasă TV, Pro TV Internațional, Pro Cinema, MTV Romania, Sport.ro). CME also mentioned a 8,7% participation in the Media Pro Group, which operates Sârbu’s print, radio and internet businesses. Adrian Sârbu has been appointed last year as CME’s COO.

The CME press release:
“Central European Media Enterprises acquires radio channels in Romania
- Radio assets complement MTV Romania with direct access to youth market -

Hamilton, Bermuda – April 17, 2008 - Central European Media Enterprises Ltd. (“CME”) (Nasdaq/Prague Stock Exchange: CETV) today announced the acquisition of the assets of Compania de Radio Pro s.r.l. (“Radio Pro”) which owns the two leading radio channels in Romania:

Ø Pro FM – the pop music channel reaching an average all day audience share of about 7% in the 15-35 year old national demographic.

Ø Info Pro – a national infotainment channel launched in 2004.

Total consideration was RON 47.2 million (approximately US$ 20.6 million). Radio Pro is a member of the Media Pro group of companies, in which CME has an 8.7% economic interest and Adrian Sarbu, Chief Operating Officer of CME, holds the remaining interest. The purchase price was set based on an independent valuation. Pro FM delivered revenues of EUR 3.3 million (US$ 5.2 million) in 2007 with an EBITDA margin of 42%. The Info Pro channel is still in a startup stage and delivered revenues in 2007 of EUR 0.6 million (US$ 0.9 million) and an EBITDA loss of EUR 1.0 million (US$ 1.6 million). The close collaboration of the Radio Pro channels with MTV Romania creates an opportunity for CME to enhance its exposure to the youth demographic and capitalize on potential cross-promotional synergies and economies of scale. The acquisition will also increase CME’s ability to offer bundled advertising services to customers across the entire Pro TV group.

Michael Garin, CEO of CME, commented: “We are thrilled to be able to acquire the profitable Radio Pro channels to further develop our expansion into the youth market in Romania. The combination of MTV Romania, our leading websites and the Radio Pro channels will further enhance our multichannel strategy and allow us to offer a broader range of audience to our advertisers.”

Adrian Sarbu, COO of CME, added: “Media Pro has been building the Radio Pro business since 1993 and established radio brands that can now successfully support the growth of CME’s new channel, MTV Romania. We also look to expand our multi-channel strategy through radio into other CME territories in the future. With an established channel like Pro FM operating at a similar EBITDA margin to CME’s most successful TV channels, we view this form of media as a strong addition to our current business model.”

CME is a TV broadcasting company operating leading networks in six Central and Eastern European countries with an aggregate population of approximately 90 million people. The company’s television stations are located in Croatia (Nova TV), Czech Republic (TV Nova, Nova Cinema, Galaxie Sport), Romania (PRO TV, PRO TV International, Acasa, PRO Cinema, Sport.ro and MTV Romania), Slovakia (TV Markíza, Galaxie Sport), Slovenia (POP TV, Kanal A) and Ukraine (Studio 1+1, Studio 1+1 International, Kino, Citi). CME is traded on the NASDAQ and the Prague Stock Exchange under the ticker symbol “CETV”.”

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