Cable and DTH still attractive to investors

Investors are increasingly looking for safe havens that do not acquire significant amounts of capex, meaning that existing cable operators and DTH players are still a good bet, while niche broadcasters are also more attractive than previously, according to Piotr Nocen, founder and managing partner of private equity group Resource Partners, which owns Latvian cable operator Baltkom.

Nocen, speaking at the Digital TV CEE conference in Prague, said that there were many companies in the sector with established infrastructure and proven cash flows.

While mainstream broadcasters have been hit by the advertising market, the growth in niche channels that have built critical mass in some markets and have gained significant market share had provided growth, said Nocen.

New opportunities such as OTT, mobile TV and broadband content still look risky to investors, according to Nocen.
The number of mergers and acquisitions taking place in the media and telecoms and IT markets in CEE has fallen significantly compared with a year ago, said Nocen.

Nocen said that while markets had been improving last year, they had fallen again since then. The slowdown in the German market in particular was likely to have an impact, he said.

Taking the example of the Polish market, Nocen said that an economy that had been growing last year was now looking problematic. GDP growth was now expected to be 3%, down from 4.5% at the beginning of the year. Other markets including Hungary were now seeing no growth at all.

Nocen said that while all sectors would likely be hit by a further downturn, pay TV was likely to fare better than many other businesses.