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bne March 2018 Companies & Markets I 17
A visibly irate Galitsky responded to journalists' questions
at the time, commenting: “The goal is not to be the biggest retailer in the country but the most profitable!” But it seems that neither the rest of the management or portfolio investors are convinced of this argument.
Magnit’s shares have barely moved in the last year, finishing 2017 essentially flat, while those of X5, and those of the third horse in the race, retail chain Lenta, have soared.
The slowdown has clearly led to internal disputes in the com- pany over strategy. Magnit announced it was dropping plans to develop a pharmacy chain in January after top executive
Sergey Goncharov quit. He had been tasked with developing the cosmetics and pharmacy formats for the retailer.
"I left because I don't see a future in the company," Goncharov told Vedomosti at the time. Under Goncharov the cosmetics and beauty formats saw sales rise 13-fold and ebitda 22-fold in 2013-2016.
VTB Chairman of the Board Andrey Kostin told reporters that he expects Magnit's capitalisation to grow and the bank knows the business well. VTB Capital’s Alexei Makhnev has been an independent director on Magnit’s board for several years and Galitsky has been the same on VTB’s board since 2015.
MTG confirms sale of Bulgaria’s Nova Group to Petr Kellner
Denitsa Koseva in So a
Swedish Modern Times Group (MTG) confirmed on February 19 that it has signed deal with Petr Kellner, Central Europe’s richest man, on the sale of a 95% stake in its Bulgarian company Nova Broadcasting Group for €185mn.
The deal will give Kellner significant influence on the Bulgarian media market as Nova is the leader in terms of turnover.
The Swedish company has been trying to sell its Bulgarian business for more than a year for some €100mn, but until now it failed to find appropriate buyer. It entered the Bulgarian market in 2007, acquiring the Diema TV channels. A year later, it bought Nova TV for €620mn.
MTG said that it will use the money from the deal with PPF to invest in its Nordic Entertainment, Studios and global digital entertainment businesses.
“MTG’s investments are focused on our Nordic Entertainment, Studios and global digital entertainment verticals, which is why we have found a new home for
our Bulgarian employees with a partner that will invest in Nova’s future,” MTG president and CEO Jørgen Madsen Lindemann said in a statement on the company's website. The deal comes amid a shakeout in the Bulgarian television broadcasting sector.
Another Bulgarian TV broadcaster – BiTV, which started broadcasting in autumn 2015 – was sold to an unknown buyer
earlier in February. According to market rumours, the broad- caster was sold as its former owners Pavel and Rumen Valnevi, two Bulgarian brothers who run a transportation network in the US, were under pressure to not influence editorial policy.
Media freedom in Bulgaria has been assessed as very poor with a high risk of political pressure on independent media and journalists.
Another big TV channel, bTV, has reportedly been put up for sale by its owner, Czech Republic-based broadcaster Central European Media Enterprises (CME), which is believed to
be trying to sell its assets in Bulgaria, Romania, the Czech
“Media freedom in Bulgaria has been assessed as very poor”
Republic and Slovakia, Capital reported. Kellner is reportedly interested in this sale as well.
In July last year, CME divested its leading Croatian and Slovenian TV stations to United Group's Slovenia Broadband for €230mn in cash to pay down debt. In January this
year, United Group sold Total TV in Croatia.
In February, Kellner was revealed to be in talks with Norwegian telecommunications group Telenor to buy its assets in Hungary, Bulgaria, Montenegro and Serbia.
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