RGE Group, owned by billionaire Len Blavatnik, has expressed interest in the acquisition of Channel 10. Sources inform "Globes" that RGE chairman Mudi Friedman met with Yossi Maimon representative Leo Malamud, and expressed the group's interest in an investment of some size in Channel 10.
Previously considered investing in the channel
RGE is one of the dominant communications companies in Israeli television. Its stable contains Channel 5 (the sports channel) and the Children's Channel. It owns a long list of media assets, and also supplies content to Cellcom Israel Ltd.'s (NYSE:CEL; TASE:CEL) television platform.
The partners of UK-based businessman Blavatnik in RGE are Israelis from the well-known Recanati family and Aviv Giladi, who has managed Blavatnik's cinema company in Los Angeles in recent years. Giladi was previously a shareholder in Channel 2 franchise holder Reshet, but was forced by Israeli regulations to sell his stake because of the channels he owned in multi-channel television.
This is not the first time that Blavatnik is considering involvement with Channel 10. On a previous occasion, he negotiated with representatives of Ron Lauder when the cosmetics mogul wanted to leave the channel in late 2013, causing yet another prolonged crisis in Channel 10.
Negotiations were recently renewed between Maimon's representative and Friedman, who himself is a former CEO of Channel 10 under Yossi Maimon, its current controlling shareholder.
Channel 10 is currently three months away from the expiration of its franchise, and has submitted an official request for a license. Although the channel is likely to receive a license even without a new investor, it will not be able to maintain itself without either additional investment by its shareholders or a new investor. Under the current ownership structure, the current shareholders, Yossi Maimon and Arnon Milchan, have not put more money into the channel for many years, while 25% of the shares are in a trusteeship.
Positive First quarter for Channel 10
Channel 10 reported positive figures for the first quarter of 2015, but it is still supported mainly by advances from advertisers. It needs NIS 60 million just for a new license, not to mention the massive investment that will be needed for productions in the years to come.
Negotiations are taking place with various parties in the market for investments in the channel, but none of them is expected to yield results before the license renewal. The most prominent of these, who has already reached the due diligence stage, is high-tech entrepreneur and advertising tycoon Ilan Shiloach.
Channel 10 and RGE did not respond to the report.
Published by Globes [online], Israel business news - www.globes-online.com - on March 31, 2015
© Copyright of Globes Publisher Itonut (1983) Ltd. 2015