Len Blavatnik's RGE Group to buy Channel 10

Len Blavatnik
Len Blavatnik

RGE will inject NIS 200 million into the Israeli commercial TV station for a 51% stake.

Just three days before the deadline, content company RGE is on the verge of reaching an agreement to become the controlling shareholder in Channel 10. The group, owned by Aviv Giladi, Len Blavatnik, and the Recanati family, will inject NIS 200 million into the channel for a 51% stake in it.

RGE's top management led by CEO Mudi Friedman, met yesterday with representatives of Bank Leumi (TASE: LUMI) for the purposes of reaching a financing deal that would make the deal possible. At the end of the discussion, it appered that current Channel 10 controlling shareholder Yosef Maiman and Arnon Milchan, who owns 25% of the shares, will receive a $10 million upside clause contingent on a future sale of the company.

The agreement is subject to approval by the RGE board of directors.

Negotiations with the group were renewed over the past three days, after RGE's leaders backed off from the deal last week when they learned that Prime Minister Benjamin Netanyahu had signed a clause obliging the channel to pay NIS 16.8 million more in order to obtain a license. Nevertheless, it now appears that this clause has no legal basis, and it cannot be ruled out that the Ministry of Finance will reverse this decision.

Channel 10 is due to show the Second Authority for Television and Radio by May 31 that it meets the conditions for obtaining a 15-year license for a television channel. If the Second Authority finds that the channel has met the requirements, and that the financial soundness of its new shareholders fulfills the legal requirements, Channel 10 is expected to become the first channel to switch to a license at the end of this June.

Published by Globes [online], Israel business news - www.globes-online.com - on May 28, 2015

© Copyright of Globes Publisher Itonut (1983) Ltd. 2015

Len Blavatnik
Len Blavatnik
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