TDC Group to gain MTG studios and entertainment business | Major Businesses | Business
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viaplay 11august2017In a move that is said to have created Europe’s first fully convergent media and communications provider, Nordic pay-TV firm Modern Times Group has combined its Nordic Entertainment and MTG Studios businesses with leading Danish telco TDC.

The companies expect the merger, which has a nominal value of $2.5 billion, to create ‘substantial’ synergies, an improved growth and earnings profile, and higher shareholder returns. Cost synergies are expected to be achieved in a number of clearly identified areas, including the consolidation of TV and digital streaming services, integration of technology platforms, brand consolidation, and customer acquisition and retention costs efficiency gains. Additional cost synergies are expected from organisational streamlining of common functions. Capital expenditure synergies are expected within the product, technology and TV distribution areas.

The combined networks and products of the two firms will reach all the ten million households in the Nordic region bringing together TDC direct to consumer offerings in mobile, broadband and TV distribution with MTG Nordics’ content production, broadcasting and streaming services. The new firm will have 2.8 million TV subscribers in Sweden, Denmark, Norway and Finland.

The merged firm — which will have a new name and brand — will also have a prominent Nordic portfolio of third-party content partnerships that encompasses entertainment brands such as Viasat, Viaplay, Viafree, YouSee Tv & Film and Get Play.

Current TDC group chief executive Pernille Erenbjerg will become the CEO of the new combined company, while MTG executive vice president Anders Jensen will become deputy group CEO. The other management positions will be confirmed on completion of the merger. The combined entity also expects to expand its footprint across the Nordic region to provide its integrated product offering in more territories.

Following the merger, MTG will focus its resources on the expansion of its global digital entertainment operations. Commenting on the merger, company chairman David Chance said: “This combination creates a first of its kind attractive new proposition for both consumers and shareholders in the Nordic region. Not only are we creating a leading provider of integrated high-quality consumer products in Denmark and Norway, with the opportunity to expand and integrate its existing Nordic operations, but we are also creating the first fully convergent media and communications provider in Europe. Convergence is a reality and the development of ever improving consumer products requires ever closer and deeper partnerships between content creators and network operators, which is why this combination will provide the brightest future for our Nordic businesses.”

Pernille Erenbjerg added: “I am very pleased to be announcing the combination of TDC Group and MTG Nordic Entertainment and MTG Studios. The businesses are highly complementary and will allow us to provide our customers with great quality content and much more flexible next generation entertainment solutions. This company will be the first of its kind in Europe.”