Sweden's Telia buys Bonnier's TV unit in $1 billion deal

Friday, Jul 20, 2018

Telia Company said on Friday it had signed a deal to buy Bonnier’s Broadcasting business, in line with its strategy to focus on Nordic core markets while exiting its Eurasian businesses.

The Nordic and Baltic telecoms operator - which earlier this week announced the acquisition of TDC’s Norwegian business in a $2.6 billion deal - had previously confirmed it was in talks with Bonnier to buy the unit, seeking to boost its TV content..

Telia said it would pay 9.2 billion crowns ($1.03 billion) on a cash and debt free basis, with a potential additional amount of maximum 1 billion based on future operational revenue and EBITA performance.

A source told Reuters late on Thursday that Telia had pushed for a deal valued below the 10-12 billion Swedish crown range that local media reported in May.

Telia said the acquisition was expected to generate synergies from 2020 with a full run-rate of 600 million crowns in 2022. It will establish a new business area, where the firm’s existing TV business and Bonnier Broadcasting will be included.

Bonnier Broadcasting, which includes brands such as Swedish TV4 and streaming service C More and Finnish MTV, had sales of 7.5 billion Swedish crowns last year and an operating profit (EBITA) of 423 million crowns.

“The acquisition of Bonnier Broadcasting will not affect Telia Company’s share buy-back program or dividend policy,” Telia said in a statement.

Analysts have raised doubts the move into media could dilute the focus on Telia’s core telecoms business, threatening dividend payouts in the longer term.

Telia’s exit from its previous growth engine in central Asia, which it began in 2015, has contributed to a strong balance sheet, raising expectations for generous shareholder payouts.

Chief Executive Johan Dennelind said earlier this week that the company had room for more acquisitions without impacting on its plans for share repurchases and dividend policy.



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