Axel Springer is close to signing a purchase agreement on a 25% stake in Polsat, the second largest Polish commercial TV broadcaster, for EUR 250m, according to unofficial information in today’s ‘Gazeta’.
Our view: If the deal came to be, this would be clearly negative for TVN (stronger rival) and Agora (enhanced cross selling opportunity for the rival). Nevertheless, we think that this is another false start in negotiations, which have continued for a number of years, but never came to any conclusion. The price offered by Axel Springer seems low, implying a massive 62% discount to TVN on 2005 P/E. It is also below the sum of EUR 300m offered earlier by Bertelsmann for the same stake. We view the news as neutral.