WARSAW: Poland’s No.1 media group Cyfrowy Polsat has moved to buy its key infrastructure partner Midas from its joint owner, valuing the company at almost 1.2 billion zlotys ($301 million). Cyfrowy said on Monday its mobile unit Polkomtel had bought 66 percent of Midas by acquiring Cyprus-based Litenite, controlled by Cyfrowy’s owner Polish billionaire Zygmunt Solorz-Zak.
The price was a symbolic 1 euro, as Polkomtel also acquired Litenite’s net debt of around 788 million zlotys ($198 million), Cyfrowy said. The group also launched a bid to buy the remaining 34 percent of Midas for 0.81 zlotys per share.
Midas, worth 0.73 zlotys per share or 1.09 billion zlotys ($273 million) in total at the Warsaw bourse’s Friday close, sells access to its fast mobile broadband infrastructure, with Cyfrowy Polsat and Polkomtel its strategic clients. “Given Midas’ portfolio of mobile frequencies I would not call the 10 percent upside to market close an overpayment,” Haitong Bank’s chief analyst Konrad Ksiezopolski said.
“Overpayment would start at around 1.0 zloty per share. Together with Cyfrowy’s results this is all positive news,” Ksiezopolski added. Cyfrowy wants to finalise the acquisition before the end of April and plans to finance the purchase from its own resources. Following a 12.5 billion zloty debt refinancing deal last September, Cyfrowy had said it would look into a potential takeover of Midas in early 2016. Cyfrowy also posted a 13-fold jump in fourth-quarter net profit to 186 million zlotys, as refinancing lowered debt costs. Net profit for 2015 as a whole almost tripled to 1.16 billion zlotys.
Midas said its 2015 net loss had shrunk to 106 million zlotys from 321 million a year earlier, thanks to a 126 million zloty one-off boost from deferred tax. Cyfrowy added it expects network expansion expenditure of up to 1 billion zlotys between 2016 and 2018, but investments will not exceed 10 percent of annual revenue.