Astorg takes control of M7 Group

French private equity firm Astorg Partners is to acquire a 60% majority holding in pan-European satellite TV provider M7 Group for an undisclosed amount.
Astorg will purchase a controlling stake in CDS Topco BV, M7’s holding company, from an investor…

French private equity firm Astorg Partners is to acquire a 60% majority holding in pan-European satellite TV provider M7 Group for an undisclosed amount.

Astorg will purchase a controlling stake in CDS Topco BV, M7’s holding company, from an investor group led by Providence Equity Partners.

Following the close of the transaction, which is expected in Q3 2014, Providence and Airbridge Investments will remain 40% minority shareholders in M7.

Astorg will fund the purchase through its €1.05bn (US$1.4bn) Astorg V fund which it raised in 2011. A spokesman for the sponsor would not comment on whether the PE was planning on tapping the debt markets to part finance the deal.

The sale comes just a month after Providence and Airbridge paid themselves a special dividend of around €110m (US$147m) from M7. The payout was funded through a new senior loan that was an expansion of the €355m (US$484m) facility Luxembourg-based M7 secured back in September 2013. The majority of the proceeds from that deal were also used to provide a special dividend to M7’s sponsor owners.

Having acquired a majority stake in Benelux-focused DTH provider Canal Digitaal Satelliet (CDS) in 2007, Providence sought to make a series of bolt-on horizontal acquisitions across Europe to rapidly gain scale.

M7 was established in October 2009 as the parent company for these acquisitions, and this inorganic growth strategy has continued to the present day.

The group now operates in seven countries serving more than three million customers. As well as regional satellite broadcasters, M7 owns internet service providers and a channel platform for cable and IPTV operators.

The Astorg spokesman said the sponsor planned to continue this buy and build strategy.

Commenting on the deal, Joel Lacourte, managing partner at Astorg, said: “M7 will take Astorg Partners one step further in its pan-European strategy. M7 combines all the qualities of a performing asset: excellent track record, professional management, high growth and strong customer franchises. We are delighted to join forces with the architects of this success.”

Deutsche Bank and BNP Paribas served as financial advisers to Providence and Emendo Capital advised Astorg on the transaction.