SNL Kagan Charts Eastern Europe’s Pay-TV M&A Activity

LONDON: According to SNL Kagan, over the last two years Eastern Europe has remained an active pay-TV market from an M&A perspective, with high fragmentation in the cable sector leading to ongoing consolidation.

There is high pay-TV penetration, the firm finds, which limits greenfield growth opportunities in cable, while intense competition among multiple DTH operators increases the need for competitive offers.

In 2015, the hottest M&A market was Bulgaria, where two leading pay-TV operators changed ownership: Telekom Austria Group acquired blizoo Bulgaria from Sweden-based investment fund EQT, and Bulgarian telecom company VIVACOM was sold at auction for 330 million euros ($368 million). Telekom Austria was also active in Slovenia and Croatia, where the telco acquired Amis, a broadband internet and IPTV provider operating in both countries.

In the Baltics, East Capital Explorer spent almost 80 million euros ($89 million) on recent acquisitions. The fund, a majority owner of largest Estonian cableco Starman, increased its stake in the company from 51 percent to 62 percent, followed by Starman’s acquisition of its Lithuanian counterpart Cgates. As a result, the group currently boasts 525,530 revenue-generating units in the Baltics.

Poland is home to 500-plus cable companies, of which only six serve more than 100,000 subscribers, with market fragmentation pushing top cable operators like UPC Poland, Multimedia Polska and Vectra SA toward M&A activity. With almost 300 cable companies, Romania is a similarly fragmented cable market, with UPC Romania and Romania Cable Systems & Romania Data Systems also buying smaller players.