Multimedia concerns

Media giants Agora and TVN have recently made controversial purchases, earning the ire of their shareholders. Both Agora's acquisition of website manager Trader.com Polska and TVN's stake in ITI Group's "n" digital platform sent the firms' share prices into negative territory.

Investors saw these transactions as overpriced. The day after Agora, which publishes the Gazeta Wyborcza daily, announced its $54.35 (zł.119.55) million purchase of Trader.com Polska, its share price dropped 7.3 percent to zł.37.45.

Last week the firm's largest institutional investor, 18.4-percent stakeholder BZ WBK Asset Management, called on Agora to let shareholders vote on a share buyback strategy.

TVN found itself in a similar situation. Last Tuesday, it agreed to pay its main owner E95 million (zł.323 million) for a 25-percent stake in "n." Concerns over the investment dragged TVN's share price to a nine-month low.

Paweł Cymcyk, an analyst with Xelion, saw no reason for panic over the price tag. "Maybe the price was too big. But, in terms of their revenues, these costs are not so large as to raise such a panic, causing stocks to drop 10 to 11 percent," he said.

For the Polish market, the Agora and TVN acquisitions are huge, but when compared to European markets, the price tags were reasonable, according to Cymcyk. He pointed out that investors should look at the effects of synergies and hidden value of the purchases instead of concentrating on the prices.

"These huge companies, Agora and TVN, should make acquisitions at times when there are low prices on the stock market, and we have those prices right now," said Cymcyk.