Communicorp Buys Metromedia International Stations

The transaction involves seventeen stations in five countries. A company statement reports the purchase price at $US14 million, subject to due diligence by Communicorp Group, with a closing date in September.

The companies eventual break-up has been the subject of wide speculation and anticipation for several years. In a restructuring of the parent company the MIG board announced its intention to divest all non-core businesses, core business being cellphone and telecom companies. Communications Equity Associates (CEA), a business broker with long ties to eastern European media, was retained in February 2003 to dissolve the broadcast holdings.

Stations involved in the Communicorp Group transaction include BG Radio in Bulgaria, Country Radio and Radio 1 in the Czech Republic, six stations of AS Trio in Estonia, the SoumiPOP group in Finland and Juventus Radio in Hungary.

Skonto Radio in Riga, Latvia was sold separately in April to local managers.

In 2003 MII sold its’ Russian cable TV and radio holdings, Radio 7 in Moscow and Katusha in St. Petersburg, to British Virgin Islands investment holding company Adamant Advisory Services.

Metromedia continues to hold Radio Szeged and a cable TV operation in Lithuania and a minority stake in Radio Fortuna and the cellphone company Magticom in the Georgian Republic.

Communicorp Group is the media and investment holding company controlled by Irish entrepreneur-legend Denis O’Brien.

O’Brien launched 98FM/Dublin in 1988, one of the first commercial radio stations in Ireland. With two Czech partners, he formed Radio Investments in the Czech Republic in 1992 and started a station group, which now numbers 16 stations most operating under the KISS brand.

In 1998 O’Brien was named Irish Entrepreneur of the Year after he sold Esat Telecom Group, a telephone company he founded in 1991, to British Telecom for $2.66 billion.

In addition to owning 98FM in Dublin, Communicorp Group holds stakes in three other Irish stations; NewsTalk 106 and Spin in Dublin and East Coast Radio in Wicklow. The company is a minority participant in an application for one of two new Dublin FM stations announced by the Broadcast Commission of Ireland (BCI) in July.

Originally published in Radio World International, September 2004, in a slightly different form

ftm Follow Up & Comments

Is 140% Ad Spending Increase Over Ten Years Normal? - February 21, 2007

Ad spending figured for 2006 in Estonia have just been released by TNS Emor and the market increased 18%, ahead of forecasts.

All media categories increased, year to year, 17% to 25%, except for internet advertising which grew 66%. But a 66% increase from very little is still very little. Disregarding the ad industry buzz, 2006 internet ad spending was only €4.2 million.

Newspapers continue to take most of the ad revenue, €37.3 million in 2006 or 43% of the market, down from 50% in 2005. Television and magazines showed increases, year on year. TV ad spending increased to €23.1 million, 27% of the ad market. Magazines increased their ad share to 11%, €9.8 million. Ad market shares for radio and outdoor fell. Radio took €5.4 million in 2006, 8% of the market whole compared to 10% in 2005 and outdoor took €5.4 million, 6% market share compared to 8% one year on.

Taking the long view – often a reasonable measure – total Estonian advertising grew 140% since 1997. The increases have been unequal: magazines 216%, TV 169%, Newspapers 108%, outdoor 93% and radio 86%.

Czech Radio Sales-houses Turnover - December 7, 2005

Czech radio sales-houses turn competitive as several broadcasters jumped to Media Market Services (MMS) effectively closing RadioNet. The change involves stations and networks owned by Radio Investments / Communicorp – Kiss Network, Radio Beat, Radio Jizera, Country Radio and Radio 1.

Lagardere owned Regie Radio Music (RRM) represents the Evrope 2 network, Frekvence 1, owned by Lagardere Active Radio International (LARI) and Radio Impuls, owned by German company Eurocast. Sales-house ARBOmedia represents public broadcaster Czech Radio (CR Cesky Rozhlas).

MMS is owned by Stamford Managing, which holds ownership interests in several stations.

“The radio industry is doing well,” reports Association of Private Broadcasters (APSV) director Michal Zelenka, who expects the radio share of all Czech advertising to reach 9.5%, increasing 6% over 2004. At last years end ARBOmedia forecast 2005 radio sales growth at 5%.

Before the sales-house shuffle MMS, RRM and ABROmedia each controlled about one-third of Czech radio ad sales. With the changes, MMS has 41%, RRM 31.6% and ARBOmedia 26.3%, according to APSV. MMS and RRM sell only radio advertising while Munich, Germany based ARBOmedia also sells television ads, worth €33 million, for Czech public television.

The quarterly radio audience surveys are also set to change in the Czech Republic. Face-to-face interviews will be replaced with 30,000 telephone interviews, supplemented by 4,000 face-to-face interviews for households without telephones.

Previously published in Radio World International, November 2005, in a slightly different form.

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