The Tickle File is ftm's daily column of media news, complimenting the feature articles on major media issues. Tickle File items point out media happenings, from the oh-so serious to the not-so serious, that should not escape notice...in a shorter, more informal format.

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Week of June 18, 2018

Telecom deals for media companies not always smooth sailing
there’s money in break-up fees

Without doubt, huge telecom and media mergers and acquisitions, recently closed or pending, have investment bankers salivating, actually slobbering all over themselves. Conventional wisdom is that every telecom in the whole world will borrow vast piles of cash to acquire a media company with which to do battle with Netflix and Amazon Prime. Board members are excited about a headline-getting deal to boost the share price and bankers want to move that money before interest rates get scary. It’s a moment of hysteria.

Swedish telecom Telia and Bonnier Broadcasting jointly announced “ongoing discussions” in late May, reported Reuters and many others (May 25). Telia is the dominant telephone provider, mobile and otherwise, in Sweden and very present in other Scandinavian and Baltic countries. Bonnier Broadcasting, a subsidiary of Bonnier, operates TV company TV4 and streaming service C More in Sweden and MTV in Finland. Industry wags suggested the deal is worth as much as SEK10 billion (roughly €1 billion or US$1.2 billion). Telia’s stock price promptly tanked on the announcement. (See more about media in Sweden here)

This week Swedish daily Svenska Dagbladet (June 18) reported a “secret” agreement between the two companies for a 10% break-up fee Telia would pay Bonnier if the deal goes nowhere. Telia snapped back, criticizing the newspaper, that there is no break-up fee agreement, in an official statement. The Swedish government holds a 39% stake in Telia and has “objections” to the deal, noted media portal medievarlden.se (June 18). By all indications the parties remain in discussion. (See more about mergers and acquisitions here)

Dead as a door-nail is the long negotiated acquisition by multinational telecom Altice of Portuguese media house Media Capital, first announced a year ago. Portugal’s Competition Authority (Autoridade da Concorrência) examined the deal and suggested both costs to consumers and competitors would rise, reported Reuters (May 29). Altice “terminated” the merger, blaming the Competition Authority, according to Observador (June 18). (See more about media in Portugal here)

Media Capital operates television company TVI, several radio stations and major production facilities. Spanish media house Prisa was exiting its majority stake in Media Capital. The deal valued Media Capital at €440 million.

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