Norwegian telecom operator Telenor is considering divesting its struggling Scandinavian satellite broadcaster Canal Digital, according to local reports.
Norwegian business news website Inside Telecom claims that sale talks for Canal Digital are already…
Norwegian telecom operator Telenor is considering divesting its struggling Scandinavian satellite broadcaster Canal Digital, according to local reports.
Norwegian business news website Inside Telecom claims that sale talks for Canal Digital are already under way with privately-held Swedish media group Bonnier as well as Danish media company Egmont rumoured to be involved. Telenor did not respond to emails and phone calls before the press deadline.
For the quarter ending 31 December 2010, Canal Digital saw its DTH subscribers fall by 27,000 below one million, at 997,000. Its operating profit also fell to NOK46m (US$8.2m) from NOK89m (US$16m) between Q3 2010 and Q4 2010.
However, Canal Digital posted increased revenues to NOK1.755bn (US$315m) compared to NOK1.719bn (US$308m) for the previous quarter, as a result of higher sale of additional services for cable and increased prices for DTH, Telenor said. Its EBIDTA increased to NOK206m (US$37m) against NOK190m (US$34m), mainly because of revenue growth from increased sales of cable TV broadband and reduced sales and marketing cost for DTH.
According to reports, Canal Digital, which provides services in Denmark, Norway and Sweden, has been faced with increased competition from DTH platform Viasat, owned by Swedish media conglomerate Modern Times Group (MTG).
In its fourth quarter, ended 31 December 2010, MTG wrote that Viasat added 16,000 net new premium subscribers in the Nordic region to about 1.057 million. Since the end of Q4 2009, the company added a total of 60,000 premium subscribers. However, its DTH satellite premium subscriber base fell by 3,000 quarter on quarter, and by 22,000 for the full year.
According to the financial results, Viasat’s pay-TV services in the Nordic region reported, in Q4, a year-on-year 8% increase in operating profits to SEK208m (US$33m), as well as a 13% increase for the full year to SEK822m (US$130m).
In recent months, Telenor has been reorganising its Nordic operations. Early January, the company agreed to sell its Danish cable assets to competitor Stofa, owned by Swedish PE firm Ratos, citing a lack of synergies between its Nordic cable divisions.
Canal Digital Denmark has been valued at DKr100m (US$18.7m) for its 56,000 direct cable subscribers and for its agreements with housing associations serving about 633,000 homes in the country.
