C More group grows subscriber base

Nordic Capital and New York-based private equity firm Baker Capital sold pay-TV provider C More Group to SBS Broadcasting for €269.6m in cash. The firms each hold about 50% of C More Group, which was formed when they acquired Canal+ Television from Vivendi Universal in October 2003.

Under private equity ownership, C More has managed to increase its subscribers and broaden its offering in a competitive and fast-moving industry. Turnover for 2004 was around €181m and subscribers grew by 100,000 to 770,000.

A substantial effort was also made to relaunch the channel format in May 2004. Channels are distributed by satellite, cable, broadband and through the digital terrestrial network.

C More moved to a prime-time scheduling focus, increasing the number of channels from three to five, and placing more emphasis on sports programming. It secured rights to the English FA Premier League and Italian Serie A football games, broadcasting more than 1,000 matches a year. It also introduced new studio programmes and subscription on demand services.

Marc-Antoine d’Halluin, CEO of C More Group, said the period of private equity ownership had brought significant change for the company. “The group has renegotiated most studio agreements, secured all key sports rights contracts for the coming years and created strong alliances with other parties,” he said.

SBS Broadcasting is a European commercial television and radio broadcaster. It will acquire C More through wholly-owned Swedish subsidiary Kanal 5 Holding. Nordic Capital and Baker Capital received financial advice from Morgan Stanley and legal advice from Vinge.

Nordic Capital is currently investing from its €1.5bn Nordic Capital V fund, which has commitments from large Nordic, European and US institutions. The firm may access substantial additional funding from an established co-investment scheme. Baker Capital, founded in 1995, is a New York based private equity firm with US$1.5bn under management.

In another Nordic exit, BC Partners sold its interest in Sanitec Corporation, the Finnish parent company of the Sanitec Group. EQT is acquiring all of the share capital of the bathroom ceramics producer. Negotiations between the private equity firms began in December. Teachers’ Private Capital, the principal investment arm of Canadian pension fund Ontario Teachers, was a minority investor in Sanitec.

BC Partners acquired Sanitec in a public-to-private transaction in 2001. The company generated sales of €951m in 2003. EQT is investing from its €2.5bn fourth fund, which closed last August.