Naspers to exit its pay-TV investments in Greece and Cyprus

Investment

Locally-listed media giant Naspers has reached an agreement on its decision to sell its Greek and Cypriot pay-TV operation, NetMed. Last week the group announced a conditional sale agreement had been entered into with telecommunications company Forthnet SA. The operation will sell for 490 million euros, a little over R6 billion at today's currency, the group said.

The company first announced its intention to exit the business in October last year. At the time, Naspers said the decision followed a review of its strategic investment priorities and its focus on emerging markets.

In its 2007 annual report, the media company said the regulatory framework for the digitisation of the terrestrial networks was taking shape. This could bring the operator further opportunities, “although the timetable remains uncertain”. NetMed contributed R1.7 billion in revenue to the group in that year.

Naspers is warning shareholders that there are several conditions still outstanding to this deal which could add risk to shareholders. “The completion of the transaction is subject to a number of conditions, including the approval by Forthnet's shareholders of a rights issue to partly fund the acquisition of NetMed. In addition, Forthnet will be required to raise debt funding. The transaction is subject to the risks typical of such capital raising,” Naspers cautioned.