CME to spin off unprofitable operations

By Chris Dziadul
July 2, 2009 07.41 UK

CME is to create a “special purpose vehicle” to effectively split its unprofitable Bulgarian and Ukrainian TV interests from the rest of the company.

According to president and CEO Adrian Sarbu, the move “will help us to preserve our liquidity and improve our ability to refinance the company.”

CME had a net debt of $1 billion (€710 million) at the end of Q1 and “aims to maintain about $300 million of cash as a cushion to run operations.”

Sarbu added that acquisitions are not currently a priority and that the company expects to return to net profit in 2011.

CME is one of the leading operators of commercial TV stations in CEE and secured Time Warner as a 31% shareholder earlier this year.

Its interests in Bulgaria include TV2 and Ring TV, while in Ukraine it operates the national station Studio 1+1, along with Studio 1+1 International and Kino.