CME to Acquire MediaPro

HAMILTON: Central European Media Enterprises (CME) has reached a deal to acquire the Romanian production and distribution outfit MediaPro Entertainment from firms controlled by Adrian Sarbu.

CME will shell out $10 million in cash to MediaPro Management and MediaPro BV, both controlled by Sarbu, the president and COO of CME. The purchase price also includes 2.2 million shares of CME’s Class A common stock and a warrant to purchase up to 850,000 shares at a price of $21.75, as well as debt assumption of approximately $35.6 million, and the contribution of CME’s 8.7 percent interest in MediaPro Management and its 10 percent interest in MediaPro BV. In addition, Sarbu has been appointed CEO of CME.

MediaPro Entertainment generates more than 500 hours of dramas and feature films per year. Its business includes MediaPro Pictures, MediaPro Studios and MediaPro Distribution. Once the transaction is complete, the company will be integrated with CME’s existing fiction, reality and entertainment production units to create a single content division consisting of production, services and distribution operations across all of the territories in which CME operates.

"In the last 20 years Adrian has built MediaPro Entertainment into a Hollywood style production and distribution business, unique in Central and Eastern Europe," said Ronald Lauder, the non-executive chairman and founder of CME. "This acquisition provides our stations with a proven source of content and allows us to further diversify our revenue streams. Adrian is the most talented executive that I have worked with and I am proud to announce his appointment as CEO of the company. He has been an incredible asset to CME and his insight and experience will continue to be a valuable resource for the company."

Sarbu added: "Content is our key competitive advantage. Consolidation of all our content assets in CME will help us to optimize our overall costs, improve the quality of our products, leverage our local talent resources and create new revenue streams. With the recent investment from Time Warner and the integration of MediaPro Entertainment we have made significant progress in our strategy to become a highly profitable vertically integrated media company."