Sources inform "Globes" that the agreement for the merger of Israel's cable television companies was signed this evening. The banks will own 30% of the merged company.
Although the three cable television companies trade under the unified brand name HOT, they are separate legal entities that work together in marketing and operations.
Golden Channels belongs toYediot Ahronot, controlled by Noni Mozes and Eliezer Fishman, who together own 65% of the company. 35% belongs to cable company Tevel .
Matav Cable Systems Media (Nasdaq: MATV; TASE: MATV) is controlled by Yitzhak Tshuva, who bought control from Shmuel Dankner.
Tevel was transferred to the banks, after Discount Investment and UPS abandoned it.
The cable companies have reached this moment after nearly three years of attempting to merge. The time that has passed has not been kind to them. Satellite broadcaster YES, a subsidiary of Bezeq (TASE: BZEQ), caused their expenses to soar, while the long merger process exhausted them. For the past year, the three shareholders have sought a way of extricating themselves from the fate that prevented the merger, of making a flotation, and stemming the constant erosion of the companies' standing.
The shareholders have undergone many changes since the failed merger attempt in 2003. Dankner, who was highly leveraged, was replaced by the more financially strong Tshuva; Fishman's position has improved thanks to developments in his businesses and the general improvement in the capital market. The debt of the cable company shareholders is by now much less frightening. Even though it totals NIS 5 billion, the fear that the stability of the banking system will be impaired as a result of the cable companies merging has receded.
Published by Globes [online], Israel business news - www.globes.co.il - on February 21, 2006
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