Times Media Group (formerly Avusa) has acquired a 32,3% stake in Ghana’s Multimedia Group for R144m.
Multimedia Group is a radio and television business and is the largest independent media company in Ghana, the JSE-listed Times Media, which owns the Sunday Times and Business Day newspapers, says in a statement to shareholders.
“Multimedia was founded in 1995 and currently owns and manages six of Ghana’s leading radio stations, three online media sites, a multichannel satellite television service and a marketing and events management business,” it says.
“Its television channels also offer access into the broader West African market, particularly Nigeria.”
Times Media says in the statement that Multimedia Group launched its first free-to-air television platform, MultiTV, in 2009. “The Ghanaian television market has seen massive growth over the past four years, and to date MultiTV has sold 1,2m set-top boxes,” it says.
“Most of the growth in MultiTV was funded with expensive debt which has strained the cash flows of Multimedia, hampering its ability to grow.”
Times Media’s investment will be used to “retire all of Multimedia’s debt, leaving the business in a powerful position to deliver further growth in television and sustainable profitability”.
In the statement, Times Media says Multimedia’s two businesses, namely television and radio, are in distinct phases of their investment cycle.
“Radio is established, has the largest market share, is profitable and cash flow positive, while television is still in the building phase and is making losses.”
Times Media says the deal forms part of its strategy to take “strategic stakes in quality media companies, backing solid management teams who understand the environment and nuances of doing business in particular regions”.
“Ghana represents an attractive investment destination and over the medium term its future is secure. Its stable political environment offers strong growth prospects and a springboard into a much larger West African market with a current population of 250m.” — (c) 2013 NewsCentral Media
