CVC seeks investor for Nine - report

CVC has reportedly started discussions with Bruce Gordon, founder of regional broadcaster WIN Corporation, and Harry Sloan, former chairman of Metro-Goldwyn-Mayer, as well as several financial investors. TPG is considering forming a partnership with Sloan and his US-listed vehicle Global Eagle Acquisitions to purchase all or part of Nine's assets.

According to the Financial Times, CVC is seeking an equity investment of about A$800 million ($830 million) and TPG has already met with the management of Nine. However, it is still early days for the private equity player to decide whether it will join hands with Sloan.

The TPG-Sloan consortium would propose to reduce Nine's debt load by at least half, a source with direct knowledge of the matter told Reuters, adding that CVC could retain a stake in a restructured Nine. "Nine is a strong cash-generating asset. The debt is the question. One just needs to fix that and they believe they can do that."

Following considerable secondary trading, Oaktree Capital and Apollo Global Management hold A$1 billion or about 37% of Nine's senior debt, and CVC has refused to entertain their proposals for a debt-to-equity swap which would effectively hand the hedge funds control of the company.

CVC bought Nine for A$5.3 billion in cash through several transactions between 2006 and 2008, but has seen the value of the assets drop significantly since then. It shelved plans for an IPO last year, while creditors have responded poorly to at least two attempts to restructure the debt pile.

CVC has been investigating a number of options to refinance the media company. In March, it was reported that CVC was seeking buyers for Ticketek, Nine's ticketing arm. It is also said to be looking to offload the company's magazine division.

Last year, Nine's 49% stake in CarSales.com was sold to institutional investors for around A$565 million. In June, Southeast Asian private equity firm Asiasons Group also acquired Australian pre-school television show Hi-5 from Southern Star Entertainment and Nine Network Australia, a unit of Nine Entertainment.

 

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• Topics
• Australasia
• Exits
• Australia
• Apollo Global Management
• Oaktree Capital
• CVC Capital Partners
• Distress
• buyout