Dogan ups bid for majority stake in Digiturk

Rebecca Hawkes | 22-01-2014

Turkey's largest media group Dogan Yayin Holding has increased its bid to US$879.5 million (from $742 million) for a 53% stake in the country's leading satellite pay-TV operator Digiturk.

The offer, made to Digiturk's owner Cukurova Holding and the state Savings Deposit Insurance Fund of Turkey, was announced to the Istanbul stock exchange on 17 January.

The 53% holding in the company was seized in May 2012 by Turkey's Savings Deposit Insurance Fund because of the scale of Cukurova's debts to the agency.

Since then a number of suitors for Digiturk have been reported, including Turk Telkom, which has offered $530 million for the same stake. Reports suggest Qatar's Al Jazeera also has shown interest in the platform, which has a $321 million-a-year deal for the exclusive rights to Turkey's Super League football, as it seeks to boost its global sports broadcast rights. Al Jazeera's beIN Sports pay-TV platforms already broadcast across the Middle East and North Africa, France, and the US.

US private equity group Providence Equity Partners owns the remaining 47% of Digiturk, which had 3,257,000 subscribers at the end of 2012 and revenues of around 1.19 billion Turkish Liras. It controlled 54% of the total pay TV market, according to IHS Electronics & Media.

Sources quoted by Reuters in December 2013 put Digiturk's enterprise value at around $1.5 billion, with a market cap of $1 billion and some $500 million of debt.

Media mogul Aydin Dogan's companies already control over 20 TV channels, in addition to D-Smart, the second satellite TV platform in Turkey, which HIS Electronics & Media claim has a 27% share in the country's pay-TV market.