Finnish media concerns flock to purchase PAP
By : Anna Kocinska
Finnish media companies Alma Media and Sanoma Group announced their intention last week to buy a minority stake in the Polish Press Agency (PAP). Ahti Martikainen, vice president of Alma Media's corporate communications department, confirmed his company's interest in PAP, although he cautioned talks were at a preliminary stage. He said Juha Blumster, president of Alma Media's business information group, was in Poland last Tuesday to attend a presentation on PAP.
"It was our first contact with PAP's management," Martikainen said. "Our interest in PAP will depend on what will be the next stage of the company's privatization and whether it will be possible to acquire a majority stake."
Alma Media, Finland's No. 2 media company with operations in broadcasting, new media, print and news services, already holds a 85% stake in the Baltic News Service, which covers Latvia, Lithuania and Estonia. "It was a healthy company," Martikainen said. "Its operating profit was E500,000 when we bought it and we also started with a minority stake."
According to Martikainen, Alma's interest in Poland shouldn't come as a surprise. "In Finland, the media market is very concentrated," he said. "Because we're a nation of 5 million, there's no room to develop our business."
Sanoma, the No. 1 media firm in Finland and publisher of Helsingin Sanomat, the Nordic region's largest daily newspaper with a circulation of 1.2 million, is also interested in PAP and announced its intentions in one of its newspapers last week.
The Treasury Ministry, which put PAP up for sale in January, plans to part with a 45% stake while keeping 51% for itself.
PAP, which was set up as a government agency to spread propaganda during communism, was transformed into a 100% treasury-owned company in 1997. In 1998, PAP's restructuring began.
Last year PAP generated a profit for the first time zl. 200,000 and state subsidies dropped to just 6% of the company's revenue this year. When the Treasury Ministry announced a tender for an adviser in the sale of PAP this year, most market observers were skeptical saying it would be difficult to find an investor willing to acquire a minority stake in a formerly state-owned news agency.
Polsat, the nation's largest private television station and owner of the Polsat Cyfrowy digital platform, is in talks with Wizja TV to broadcast Wizja Sport on Polsat's platform and to return Polsat and Polsat 2 to Wizja's platform, a source who wished to remain anonymous said last week.
Zygmunt Solorz, founder and owner of Polsat, denied that talks were underway. "We talked about combining Polsat Sport (Polsat's sports channel on its digital platform) and Wizja Sport, but we didn't agree to it," he said.
Polsat and Polsat 2 had been available on Wizja TV until last year, when Solorz left the platform to develop his own digital operations. To generate financing for his platform, Solorz plans to list Polsat on the Warsaw Stock Exchange (WSE). But in a May interview (/common/article.asp?id=118680&site=2) with the Business Journal, Solorz said he would consider teaming up with other platforms if "the other side expresses such a will."
Despite strong opposition by Telewizja Polska (TVP), Polsat might now be able to freely transmit TVP's signal on its digital platform, Polsat Cyfrowy.
In January, TVP filed a lawsuit against Polsat, accusing the station of illegal transmitting TVP's two channels.
But in May, the Warsaw-based District Prosecutor's Office for Praga Poludnie threw out the case. "The prosecutor found no evidence that a crime had been committed," said Malgorzata Dukiewicz, spokeswoman for the Prosecutor's Office. Zygmunt Solorz, owner of Polsat, said he wasn't surprised by the prosecutor's decision. "We had TVP's consent in writing," he said. But according to TVP's spokesman, Janusz Cieliszak, the public broadcaster is not going to give up. "We will first submit a complaint and then appeal against that decision," he said last week. According to Cieliszak, Cyfra+, which is owned by France-based Canal+, is the only digital platform in Poland entitled to transmit TVP's signal. "Polsat has been evading the law and this way it encouraged others," he said.
Earlier this month, Wizja TV also included TVP into its digital program offering, without the company's consent. (see page 1)
On June 17, more than 8 million Poles, or a record 69.17% of the nation's TV viewers watched the final hours of TVN's "Big Brother" reality show. The 100 day, fly-on-the-wall program began in March. "Big Brother" attracted the majority of viewers in cities with more than 100,000 citizens, according to TNS OBOP, a market research company. It also said viewers with a secondary education accounted for 36.5% of the show's audience, while those with a primary education accounted for 27.5%. Nine percent of the program's watchers had a university degree, TNS OBOP said.
