MBK's CNS exit may be stalled - report

One year ago, MBK said it would exit its 60% stake in CNS to the head of local snack food maker and media owner Want Want for $2.4 billion, resulting in 2010's largest Asian private equity exit. Secondary buyers such as Permira, Bain Capital, the Blackstone Group, Providence Equity Partners and KKR were also drawn to the asset, as well as other corporate suitors.

However, a group of regulators, academics and media experts have questioned the reporting style of other Want Want media assets including the China Times daily newspaper and the CtiTV cable station. They are asking whether CNS' reporting would parallel these other outlets under Want Want, according to Reuters. At a hearing Monday, the groups specifically expressed concerns that Want Want would stifle freedom of speech initiatives.

The transaction was supposed to be a reminder that deals could still close in Taiwan, at time when other private equity transactions have been blocked or delayed. Such deals included The Carlyle Group's exit of local cable TV and broadband asset Kbro to the Tsai family last year, which came after nearly a year of delays due to rules regarding government affiliates' ownership of media businesses. In June of this year, a KKR-led MBO of Yageo was also rejected by regulators, who said minority investors did not have sufficient information to determine whether the acquisition was in their best interest.

MBK purchased CNS in October 2006 for $1.6 billion, which means it is in line for a substantial gain should the transaction go through.

CNS claims more than 1.1 million subscribers in a country of 23 million people, as well as 10 system operations and more than 130 television channels.

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• Topics
• Greater China
• Media
• Exits
• Regulation
• MBK Partners
• Exit
• regulation
• TMT
• Taiwan (China)