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Discussion Materials
July 2013
Confidential Presentation
Table of ContentsAgenda
1. Update on Barclays
2. Liberty Global Update
3. Chellomedia Positioning
4. Detailed Asset Overview4. Detailed Asset Overview
5. Strategic Alternatives
6. Potential Buyers
7. Sector Valuation
________________________________________________________________________________________
Appendices
Update on Barclays
$199bn across 186 deals
Global TMT – A Top Ranked Investment Banking TeamLandmark transactions executed across all products, sectors and regions
AdvisoryEquities Global TMT
TMT
$16 billion
Initial Public Offering
has agreed to sell
to
HOME$153 million
Initial Public Offering
$766 millionInitial Public
Offering
Joint Bookrunning $24.4 billion
have agreed to acquire
Michael Dell &
$46.7 billion total value
has made an unsolicited offer for
2012
Over 80 industry bankers
4 main offices and 8 points of presence worldwide
Top 4 across Equity, Debt and M&A in the U.S. for 2010-2012 DebtDebt
TMT
$3.65 billionSenior Secured Credit Facilities
$1.015 billionSenior Unsecured Notes
€250 millionSenior Unsecured Notes
Joint Bookrunner
May 2012
Exclusive Financial Advisor to Google
Pending
$4.5 billion
Multi-year Senior Notes
€750 million
5 yr Senior Unsecured Notes
€1.5 billion
Dual Tranche Senior Unsecured Notes
£1.1bn / $1.0bnSr. Sec. Notes£250m / $535m Senior Notes
£600m / $2.8bn TLB£375m TLA and £250m RCF$500 million
Senior Notes
$1.0 billion
December 3,2012
Exclusive Financial Advisor to CSC
Credit Services
has agreed to be acquired by
October 2012
Lead Left Bookrunner
October 10,2012
$1.1 billion
Initial Public Offering
Joint Bookrunner
December 2012
Joint Bookrunning Lead Manager
December 2012
$299.5 million
Registered Block Trade
Joint Quarterback
$225 millionCommon Stock PIPE Offering
February 2012
ExclusivePlacement Agent
$9.5 billionTransaction valueFinancial Advisor
February 2012
has agreed to be acquired by
€1.25 billion
Senior Notes
Joint Bookrunner
$24.4 billion
Pending
Financial Advisor
US$700m FXD due2016US$900m FRN due 2016
US$1,400m due 2018US$1,600m due 2023US$1,400m due 2043
Has agreed to divest its 99.05% stake in
Hellas Sat to
€208 millionFinancial Advisor to OTE
Pending
$46.7 billion total value
Pending
Exclusive Financial Advisor
Senior Unsecured NotesJoint Arranger & Joint Bookrunner
March 2012
___________________________Source: Mergermarket, Bloomberg, Dealogic.
December 2012
$8 billionSenior Unsecured
RCF
Joint Lead Arranger, Bookrunner and Documentation
Agent
November 2012
$2.25 billion5 / 10 / 30-year Senior Notes
Bookrunner
November 2, 2012
Senior Notes
Joint BookrunnerSeptember 5, 2012
Joint Bookrunner
June 2012
Active Joint Bookrunner
February 2013
Joint Bookrunner and MLA
August 2012
$1 billion
12 yr Senior Subordinated Notes
Joint Bookrunner
October 4, 2012
$2.6 billion
Financing Package
Lead Left Arranger, Lead Left Bookrunner , Administrative
Agent
September 28, 2012
$2.5 billion
Senior Unsecured Credit Facility
Active Joint-Lead Arranger and Joint Bookrunner
October 5, 2012
$1.85 billionCredit Facilitates Amendment
and Re-pricing
Joint Lead Arranger, Bookrunner and Syndication
Agent
February 2012
Joint Bookrunner
August 27,2012
$600 million
Collared Accelerated Share
Repurchase
Sole Counterparty
November 2012
$700 million
Whole BusinessSecuritization
Sole Structuring Advisor / Sole Bookrunner
Joint Bookrunner
January 2012
US$1,400m due 2043Joint Bookrunner
2013
1
Leading Global Media FranchiseM&A Transactions
May 2012Financial Advisor
$150 milliongrowth equity investment
for a 50% stake in
50% rollover equity stake between Founders
and
Sole Financial Advisor
has agreed to acquire
Undisclosed
August 2012
$1.8 billion
July 2012Financial Advisor
has agreed to merge with
$2.9 billionhas agreed to
acquire a stake in
December 2011Financial Advisor
€400 millionhas agreed to acquire
October 2011Financial Advisor
£525 millionhas agreed to
acquire
October 2011Financial AdvisorSole Financial Advisor
has agreed to acquire a 12.65% stake in
€633m
March 2013
Capital Markets Transactions
May 2012August 2012 July 2012 December 2011 October 2011October 2011
September 2011
$400 millionhas agreed to be
acquired by
Financial Advisor
$1.8 billionhas agreed to be
acquired by
July 2011Financial Advisor
Russia
Undisclosedhas agreed to
purchase 79% of
July 2011Financial Advisor
NOOH Investments
$425 millionhas agreed to be
acquired by
May 2011Financial Advisor
January 2011
Exclusive M&A Advisorto Vivendi
$5.8 billion
to
has agreed to sell its 20% stake in
Road show Coordinator Advisor to Liberty
$1.2 billion
December 2010
has agreed to merge with Liberty Acquisitions Holding(a special purpose vehicle)
December 2010
has agreed to acquire
and a 22% stake in
€1.1 billion
Financial Advisor to Telecinco
T E L E C I N C O
€500 millionSenior Secured
Notes
March 2013
$1.0 billionSenior
Notes and Tender Offer
€1.0 billionRegistered Block Trade
of 20% stake from
$1.0 billionSenior Secured
Notes
$259 millionSenior Notes
$530 millionSenior Unsecured Notes €700 million
Eurobond Issue
Notes
May 2013
Joint Active Bookrunner
$1.0 billionSenior Credit Facility
August 2012
Lead Arranger / Bookrunner
August 2012
Joint Global Coordinator /
Joint Bookrunner
$600 millionSenior Unsecured
Notes$16.0 billion
Initial Public Offering
Joint Bookrunner
April 2012
$2.6 billionAcquisition Financing for
In Association with Sale by
Joint Lead Arranger and Joint Bookrunner
November 2012
March 2013
Lead Left Bookrunner / Lead Dealer Manager
March 2013Sole Arranger
February 2013
Joint Bookrunner
$11.6 billionAcquisition Financing to
acquire 100% of
January 2013
Joint Bookrunner
€500 millionSenior Secured
Notes
January 2013
Active Joint Bookrunner
$2.95 billionSenior Unsecured
Notes
April 2013
Joint Bookrunner and Joint Dealer Manager
May 2013
Joint Placement Agent
May 2013
Lead Left Bookrunner
March 2013
Joint Global Coordinator & Joint Bookrunner
2
Long Track Record as Advisor in the Broadcasting SectorBarclays (1) advised on all the relevant Broadcasting transactio ns over the last 15 years
$2.9 billionhas agreed to acquire
a stake in
Financial Advisor
Strategic
potential acquisition of
Advisor
Strategic Buyer
potential acquisition of
Advisor
Private Equity Fund
potential acquisition of
Advisor
Private Equity Firm
potential acquisition of
Advisor
Nordicpotential acquisition of digital asset
Advisor
potential acquisition of
Advisor
Sole Financial Advisor
has agreed to acquire
Undisclosed
August 2012Sole Financial Advisor
February 2011
has agreed to sell
to
NT$6bn (US$199m)
$1.0bnCapital Increase
45.6 million new “N” sharesAt ZAR 163 per share
raisingZAR7.4 billion
has acquired
for
€3.3bn
EV of €490 million has agreed to sell
to
EV €490mFinancial Advisor to
Exclusive Financial Advisor to Vivendi
has agreed to sell its 20% stake in
to
$5.8 billion
January 2011
$975 million
Exclusive Financial
have agreed to a strategic joint venture in
T E L E C I N C O
€1.1 billion
has agreed to acquire
and a 22% stake in
Financial Advisor to
Joint Corporate Broker and Exclusive
Financial AdvisorJune 2012
Financial AdvisorNovember 2012
Sale of 15.43% stake for an implied post-money
valuationof $762m to
Exclusive Financial Advisor
May 2010 and May 2011
$412 million
Joint Financial Advisor &Fairness Opinion to Lionsgate
January 2012
has agreed to acquire
AdvisorWithdrawn
AdvisorWithdrawn
AdvisorWithdrawn
AdvisorWithdrawn
AdvisorOngoing
AdvisorWithdrawn
Road show Coordinator Advisor to Liberty
$1.2 billion
December 2010
has agreed to merge with Liberty Acquisitions Holding(a special purpose vehicle)
Has agreed to acquirea 30.6% stake in
For $242m(EV $1.8bn)
Financial Advisor to
has agreed to acquire a stake in
Exclusive Financial Advisor to Discover
$250 million
howstuffworks
Financial AdvisorMarch 2008
Exclusive Financial AdvisorJuly 2007
___________________________1. Includes transactions executed by team members at prior institutions.
Financial Advisor to Naspers
August 2008
Advisor to Scripps
December 2009
Financial Advisor to Telecinco
December 2010
andHave agreed with
and
to merge their French Pay-TV
Activities to createCanal+ France
Financial AdvisorJanuary 2007
€675,000,000 sale of
Germany access business to
Financial Advisor to TimeWarner and AOL
September 2006
has formed a strategicalliance with
involving an investment of $1.5 billion
Financial AdvisorJanuary 2002
Has acquired minoritystakes of
and
in
Financial AdvisorJuly 2006
NETMED
GLOBAL FINANCE
andHave agreed with
to exchange Lagardère’s 34%interest in CanalSatellite
and €525m in cash for a 20% interest in Canal+ France
Financial AdvisorJanuary 2007
buyback of 25.1% Minority Stake from
€4.5bnAdvisor
July 2006
GroupeBruxellesLambert
on its sale of
to a consortium comprising
€2.6bnAdvisor
May 2007
Financial Advisor to Time Warner
May 2009 October 2007
Advisor to Discover Communications
3
European Media Equities Team
Coverage Universe
Julien Roch – Media Research� Julien Roch is a Managing Director within Equity Research at Barclays. Based in
Paris, he heads the European Media Equity Research team� Mr. Roch joined Barclays in September 2009. He has extensive experience
analysing the media sector. Previously he has worked at Merrill Lynch for six years where the team achieved No1 rankings in both the Institutional Investor survey and
United KingdomFrance
#1#1 Rated #1 by Institutional Investor and Extel Survey at previous firm
where the team achieved No1 rankings in both the Institutional Investor survey and the Extel survey. Prior to this he worked for eight years at Lehman Brothers
Nick Dempsey – Media Research� Nick Dempsey is responsible for coverage of B2B and Consumer Publishing, as well
as Satellite Services, in the Barclays European Media equity research team. He has ten years of experience in the media sector
� Prior to Barclays, he was at Merrill Lynch for 4 years covering consumer publishing in a team that achieved over the period No1 rankings in both the Institutional Investor's "All-Europe Research Team" survey and the Extel survey
Netherlands
Daily Mail and General Trust plc
Natasha Brilliant – Media Research
� Natasha Brilliant joined Barclays in August 2009 and is currently a research analyst following the European media sector
� Prior to Barclays, Natasha was at Merrill Lynch, in a team that achieved No.1 rankings in both the Institutional Investor's "All-Europe Research Team" survey and the Extel survey
Belgium
Andrew Ross – Media Research� Andrew Ross is an Analyst within Equity Research at Barclays, based in London
� Andrew joined Barclays in 2011 as a graduate analyst within the European Media
Italyantena3
SpainJames Woolf– Technology / Media Sector Specialist
� Mr Woolf Joined Barclays in August 2009, having previously been a fund manager
at Cheyne Capital in London focused upon the global TMT space. Prior to that
worked for 8 years at Goldman Sachs initially as a specialist equity salesperson then
later on the trading desk
Germany� Andrew joined Barclays in 2011 as a graduate analyst within the European Media team, having previously interned with the team in 2010
� Andrew graduated from Durham University with a first class degree in Economics.
4
Liberty Global Update
Liberty Global Update
Situation Overview European Geographic Presence
� Largest cable company outside of the U.S., with market-leading operations across 13 countries in Europe and Latin America
� Largest Western European operations in Germany, Netherlands & Switzerland
� Controlling 58% stake in Telenet, Belgium’s leading cable operator (Public)
� LGI footprint connects 20m customers who take-up 34m services
LGI Cable Presence
LGI / Chello Presence
70.0
75.0
80.0
85.0
20
25
30
Share Price Performance
Poland22%
Other32%UK
39%Netherlands
Others18%
LGI Revenue Split Chello Revenue Split
� LGI footprint connects 20m customers who take-up 34m services
� Chellomedia is the content division of LGI and a leading international producer and distributor of TV channels
� Recent LGI acquisitions include
� 12.65% stake in Ziggo (€630m) in March 2013
� Aster (€602m) in Poland in December 2010
� LGI also announced Virgin Media acquisition for €17bn in February 2013
28 Mar 2013LGI acquired a 12.65% stake in Ziggo (2)
(3)
LGI / Chellomedia Revenue by Geography
(1)
(1)
(1)
Volume (m)Price ($)
Share Price as of 10 May 2013 ($) 76.93
Market Capitalisation ($m) 30,433
Adjusted Net Debt ($m) 41,521
Enterprise Value ($m) 71,954
Valuation Metrics Metric ($m) Multiple
EV / 2013E EBITDA 8,204 8.8x
EV / 2014E EBITDA 8,808 8.2x
10 May 2012 09 Aug 2012 08 Nov 2012 07 Feb 2013 10 May 2013
40.0
45.0
50.0
55.0
60.0
65.0
70.0
0
5
10
15
20
___________________________Source: Company website, Broker research, Factset as of 10 May 2013.1. Pro forma announced Virgin Media acquisition.2. Other includes Austria, Sweden, Norway, Hungary, Poland, Czech Republic, Slovak Republic, Romania, Slovenia, Chile and Puerto Rico.3. Other includes Latin America, the UK, Portugal, Czech Republic, Romania.
Netherlands21%
Spain13%
Hungary12%
32%39%
Germany15%
Belgium (Telenet)
13%
Sw itzerland8%
Netherlands7%
1 Aug 2012 Chellomedia acquired MGM Networks
5 Feb 2013LGI announced an offer to acquire Virgin Media
EV / 2014E EBITDA 8,808 8.2x
5
Chellomedia Positioning
Key Investment Highlights
Leading global provider of
thematic channels
Strong management and track record of inorganic and JV-
based growth6
1
High quality niche channels with strong market
positions
Beneficiary of industry wide trends in
advertising and Pay TV subscription revenues
based growth
Strong financial track
6
5
2
Diversified revenue base across geographies, business lines and
customers
Strong financial track record of sustained
revenue growth and cash conversion
5
3
4
6
Leading Global Provider of Thematic Channels
Overview
� Largest independent Pay-TV channel operator in Europe
� Produces and distributes thematic channels in over 125 countries and in over
Well diversified European channel portfolio and loc al knowledge
Reach in More Than 125 Countries
At Media Ad Sales
1
27 languages
� Reaches over 390m TV households in EMEA and Latin America
� Chello owns 48 channels and has 19 JVs with top-tier third parties including CBS, Polsat and Zon Multimedia
� Leading brands across lifestyle, entertainment, movies, sports and factual genres
� Leading digital services provider in Europe
� Ad sales, digital playout and channel management services
Madrid
Budapest
Miami
London
Amsterdam
management services
� Customer base includes major players such as Nat Geo, Fox, NBCU and Disney
� Over 1,200 employees across 26 locations with primary offices in London, Amsterdam, Budapest, Madrid and Buenos Aires
Buenos Aires
Main Offices
7
High Quality Niche Channels With Strong Market PositionsChellomedia’s high quality channels are vying for g enre leadership across multiple geographies
0.7
0.30.20.4
0.6
0.8
1.0%
Sports Share of Audience in Hungary Documentary Share of Audience in Spain
2.21.9
1.51.3
0.71.0
1.5
2.0
2.5%
2
0.30.2
0.0
0.2
0.4
Sport1 Sport2 Sport Klub
Kids Share of Audience in Romania
Documentary Share of Audience in Hungary Movies Share of Audience in Spain
Kids Share of Audience in Portugal
0.8 0.80.7
0.0
0.2
0.4
0.6
0.8
1.0
Discovery Nat Geo Spektrum
%2.6
1.71.4 1.4
0.5
0.00.51.01.52.02.53.0
Hollyw ood XTRM Somos TCM Dcine Espanol
%
2010 Prime Time Ages 18-49
2010 All Day Females 18-49 2010 All Day Ages 4+
0.7
0.0
0.5
1.0
Discovery Historia Odisea Nat Geo Natura
2010 All Ages 4+
___________________________Source: Ratings reports.
Kids Share of Audience in Romania Kids Share of Audience in Portugal
22.120.3 19.5
0.0
5.0
10.0
15.0
20.0
25.0
Minimax Disney Cartoon Netw ork
%
2010 Day Time Ages 4-7
6.9
3.2
1.5 1.0 0.8 0.20.01.02.03.04.05.06.07.0
Panda Disney Nickelodeon Panda Biggs DisneyCinemagic
CartoonNetw ork
%
Chellomedia Channels Competitors Channels
2010 All Day Ages 4+
8
High Quality Niche Channels With Strong Market Positions (cont.)
Netherlands Hungary Spain
� NA
2
Key Broadcasting Rights in Selected Countries
Hungarian National Football League
Sports Rights
Movie Rights
___________________________Source: Company website, Press.
Recent News
� July 2012: Chello Central Europe has been awarded certain media rights for the 2012-15 UEFA Champions League in Hungary, including the final and UEFA Super Cup
� May 2012: Chello Central Europe channels Sport1 & Sport2 have bagged broadcast rights to Spanish Primera Division, the strongest national football league in the world, for the coming three seasons
9
Diversified Revenue Base Across Geographies, Business Lines and Customers
� Well diversified revenues across geographies and genre
� Significant and growing revenue contributions from advertising sales (At Media) and playout services (DMC)
Broad Customer BaseOverview
3
TV
Poland22%
Other32%
� At Media is Chello’s advertising representation business in Poland, the Czech Republic and Hungary
� Chello DMC, located in Amsterdam, provides advanced playout and content management solutions to local and worldwide clients
Business Line DiversificationGeographical Diversification 2012
(1) TV Revenue
Dig
ital S
ervi
ces
The Netherlands21%
Spain13%
Hungary12%
___________________________Source: Company data.1. Other includes Latin America, the UK, Portugal, Czech Republic, Romania.
Advertising Sales
Digital Media Centre
10
Strong Financial Track Record of Sustained Revenue Growth and Cash Conversion
� Historical performance throughout downturn highlights resilience of business model and strong customer relationships
� Long term carriage contracts deliver stable revenues
� Management focussed on revenue growth and cost control
� Disciplined acquisition policy delivering profitable inorganic growth
Overview
4
300
400
500
600
EBITDA (2)Turnover (1)
$m
9097
19%19%
60
80
100
120
15%
20%
25%
30%$m EBITDA margin
467
PF impact of MGM Channel
acquisition501
PF impact of MGM Channel
acquisition
0
100
200
2010A 2011A 2012E
0
20
40
2010A 2011A 2012E
0%
5%
10%
___________________________Source: Company data.1. 2010/2011 revenues from LGI annual report.2. EBITDA margins are implied from 2010/2011 disclosure on Chellomedia Programming unit.
11
Chellomedia has a substantial addressable market wi th core countries projected to see strong growth
Beneficiary of Industry Wide Trends in Advertising and Pay TV Subscription Revenues
2013 TV Ad Spend and Growth 2008-2014 Pay TV Revenue
9.239.442.6
45.751.8
48.950
60
HHS
10.0%12.0%
Ad Spend ($m)
319 25,038 265 576 2,828 1,267 5,170
301m 303m 306m 308m 311m 313m 315m
($bn)‘13-’14Growth
5
Growth in Advertising Revenue 2011-2015
23.9
30.230
35
Multi channel share of Net TV Ad spend by 2015
17.0% 22.0% 9.2% 21.6% 25.2% 33.2%19.6% 23.3% 26.0% 40.5%
28.7 29.9 33.4 36.0 38.3 40.6 42.6
5.1 5.26.0
6.67.4 8.3 9.2
33.8 35.139.4
42.6
0
10
20
30
40
50
2008 2009 2010 2011 2012 2013 2014Western Europe Central & Eastern Europe
10.0%
8.3%
6.5%5.4%
3.0%1.9%
1.0%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
Romania LatAm Hungary Portugal Spain Poland UK
___________________________Source: Screen Digest.
7.79.9 10.8 11.3
6.0
11.4
19.723.9
20.2
1.6 2.4 2.3 2.8 2.34.9
7.010.7
12.9
8.4
0
5
10
15
20
25
30
Italy Portugal NL Spain Western Europe Poland Hungary Romania Turkey Central &Eastern Europe
Multichannel TV Advertising Grow th, % National TV Channel TV Advertising Grow th, %
12
Strong Management Capabilities and Track Record of Inorganic and JV-based Growth
Overview Recent Acquisitions
Business/ Asset Geography%
Acquired%
OwnershipDate
Closed
Cosmo TV Latin America 50.0% 100.0% Sep-12
MGM International Channels Global 100.0% 100.0% Aug-12
� Management with extensive experience
� Strong track record of acquiring long-term valuable content assets
� Chello scale and global reach enhances negotiating position with smaller ‘bolt-on’ targets
� Deep experience of JV creation with core content provides
6
Main Asset Contributed JV Partner CM Equity (%) Date Closed
Zone Reality, Romantica, Club & CBS Studio
OBN Televizija Bosnia & Herz. 40.0% 40.0% Aug-11
Romantica Realitatea Romania 49.0% 100.0% Nov-10
JimJam Global 40.0% 100.0% Jul-10
Teuve Spain & Port. 100.0% 100.0% Apr-10
Spektrum CEE 100.0% 100.0% Sep-08
Sport CCE CEE 20.0% 100.0% Dec-07
Filmmuzeum TV Paprika Deko CEE 100.0% 100.0% Oct-07
At Media CEE 100.0% 100.0% Oct-07
JimJam Global 100.0% 100.0% Sep-07
Zonemedia CEE 10.2% 100.0% Jul-07
Minimax CEE 50.0% 100.0% Jul-07
Niall CurranPresident of Chellomedia
Niall has been with LGI since 2000, and with Chellomedia since 2003
Ron Huisman CFORon joined LGI in 2000 and has worked as a VP in the Group M&A
Simon FreerChief Commercial
OfficerSimon heads up Corporate Development withspecific responsibilities in group M&A
Dermot Shortt CEO, Chello ZoneDermot joined Chello Zone in 2002 and was responsible for the business’ sale to Chellomedia
Susan ElkingtonEVP, Entertainment
DevelopmentSusan joined joined Chellomedia (UPC Media) in 2000
Key Management
Joint Ventures
___________________________Source: Company websites, Press.
Zone Reality, Romantica, Club & Europa
CBS Studio International
70% Oct-12
Outdoor Channel (Europe) Outdoor Channel NA Sept-10
Chello Multicanal Panda & Hollywood Channels (10 yr agreement)
Zon 50% Dec-09
Zone Club EMEA feed Scripps 20% Nov-09
Chello Zone UK Channels CBS 50% Oct-09
A&E AETN 50% Oct-98
Documania n.a. 100.0% 100.0% Mar-07
Sportone.nl Netherlands 100.0% 100.0% Feb-07
Filmfocus n.a. 100.0% 100.0% Jan-07
Sport1 - CCE CEE 55.0% 80.0% Aug-06
Multicanal Spain 100.0% 100.0% Nov-05
Canal + Netherlands 100.0% 100.0% Oct-05
Zonemedia CEE 89.8% 89.8% Jan-05
13
Detailed Asset Overview
Chello Zone Overview
� Chello Zone produces and markets a number of widely distributed multi-territory thematic channels in over 100 countries and in over 20 languages. Major channels include:� 4 channels across different genres� 6 channels through a 50-50 joint-venture with CBS Studios International in
the UK launched in November 2009 (CBS Reality, CBS Reality +1, CBS Drama, CBS Action, Horror Channel and Horror Channel +1)
� March 2013: Chello Zone launched its seventh feed for kids channel JimJam, to cover the Benelux region
� August 2012: Chellomedia and CBS Studios International announced a new agreement to create CBS-branded channels from Chello Zone's existing bouquet of channels in 83 territories across Europe, the Middle East and Africa, with a collective reach of 43 million subscribers . CBS will receive a 30% stake in the channels contributing its programming and trademark
Overview Recent News
Chello Zone is a leading operator of global themati c channels in Europe, Middle East, Asia and Africa
Drama, CBS Action, Horror Channel and Horror Channel +1)� 4 channels through a 70-30 JV with CBS outside the UK (CBS Reality,
CBS Drama, CBS Action and CBS Europa)� 2 channels through a 11-89 joint-venture with Scripps
� Other services that Chello Zone provides include program sales, channel representation and language versioning
in the channels contributing its programming and trademark� June 2012: The CBS Chello Zone channels in the U.K. have grown
impressively since the rebranding in 2009. Viewership for the CBS-branded channels has increased by more than 130%(1)
Film Sports Kids Lifestyle Lifestyle/Women Cooking
Adults Male 25-44 Children 1-6 Men 25-55 Female 25-44 All Adults
EMEA >65 EMEA >50 EMEA Middle East 45 EMEA >75 EMEA
Channel Brands
Genre
Target Audience
Countries
Key Channels Offering
___________________________Source: Company data, Website, Press.1. November 2009 vs. June 2012 consolidated, BARB.2. CBS Reality and Horror channels also exist in time shift services as CBS Reality + 1 and Horror Channel + 1.
Action Reality Film Drama Film
All Adults All Adults All Adults All Women All adults
83 EMEA 81 EMEA UK, Ireland, Italy 83 EMEA EMEA
Channel Brands
Genre
Target Audience
Countries
(2) (2)
14
Chello Central Europe Overview
� Chello Central Europe offers thematic channels which are distributed to the UPC Broadband Division and other operators in Central and Eastern Europe. Key channels include: � 11 consolidated channels across 5 different main genres� OBN is a joint venture channel with the leading general entertainment
broadcaster in Bosnia and Herzegovina
� December 2012: Chello Central Europe rebranded its Romantica channel to Film Cafe in Romania
� July 2012: Chello Central Europe Hungary acquired programming from Cineflix Rights’ catalogue, including series Cold Blood
� June 2012: Chello acquired Ceska programova spolecnost (CPS) and assumed the entire capital of CPS
Chello Central Europe focuses on thematic TV channe ls and content for the Central Europe market
Overview Recent News
broadcaster in Bosnia and Herzegovina� Chello Central Europe also operates At Media, an advertising sales
representation business in Poland, the Czech Republic and Hungary, and has a channel representation business
� Aims to expand channel portfolio breadth and footprint further through new launches especially in and through M&A
Sports Sports Sports Documentary Cooking Lifestyle
Adults 26-55 Adults 26-55 Adults 26-55 Adults 26-55 Adults 26-55 Adults 26-55
HungaryCzech Republic
SlovakiaRomania
HungaryCzech Republic Hungary
HungaryCzech
Slovakia
HungaryCzech
SlovakiaRomania
HungaryCzech
Slovakia
Channel Brands
Genre
Target Audience
Countries
Key Channels Offering
Key Sports Rights
Hungarian National Football League
___________________________Source: Company data, Website, Press.1. 40-60 Joint-Venture with Bosnia and Herzegovina’s largest private free-to-air broadcaster.
Drama Kids Kids Archive Film Sports, Film, Lifestyle Film
All Women Kids 2-12 Kids 7-14 Adults 26-55 Adults 20-49 Adults 26-55
HungaryPoland
Romania
HungaryCzech
SlovakiaRomania
Ex-Yugos.
Hungary Hungary Bosnia and Herzegovina
HungaryCzech
SlovakiaRomaniaSlovenia
Channel Brands
Genre
Target Audience
Countries
(Previously Zone Romantica) (Previously Film Muzeum)
(1)
15
At Media
� 2013: MTG Hungary entered into an ad sales agreement with At Media
� December 2012: UPC Polska has entered into an important new partnership with At Media and Nielsen Audience Measurement
� At Media was the first sales house in 1998 for thematic channels in Poland and it 100% owned by Chellomedia
� Today it is one of the largest advertising sales house representing thematic channels in Eastern Europe
Overview Recent News
Leading thematic channels advertising sales house i n CEE
partnership with At Media and Nielsen Audience Measurement
� November 2012: At Media noted as a Poland’s leading thematic channel ad sales agency that offers distribution and marketing to a number of TV companies
representing thematic channels in Eastern Europe
� Has offices in Poland, Hungary and Czech Republic
� The unit offers TV and ad sales as well as internet ad sales
� Currently represents 53 international channels, including brand names such as MTV, Nickelodeon, National Geographic and AXN
Geographic Coverage Leading Sales House in Central Europe (1)
3.54.9
13.513.7
15.515.5
16.8
TVP INFOTVN
TVP2At Media
TVP1Polsat
TVN
% share in viewership
___________________________Source: Company data, Website, Press.1. AGB Nielsen Audience Measurement (2010).
6.90.00.00.00.10.30.5
1.01.1
1.82.2
2.93.5
OthersPolonia1
VIVAMango 24
ITVEurosportTVPolonia
DisneyTVP them.
TVN7TV4
DiscoveryTVP INFO
16
Chello Multicanal Overview
� Chello Multicanal is the largest and leading independent producer and distributor of thematic TV in the Iberian market
� Key thematic channels offering consists of:� 12 consolidated channels across 4 different genres� 4 non-consolidated channels through a 50-50 joint-venture with Zon
� October 2012: Chello Multicanal took over Difference T Media in order to increase its presence in non-conventional advertising
� March 2011: Chello Multicanal is launching kids channel Canal Panda in Spain
Largest independent channel operator in Spain and P ortugal
Overview Recent News
� 4 non-consolidated channels through a 50-50 joint-venture with Zon� 3 non-consolidated channels through a 50-50 joint-venture
with AETN� Other services that the company provides include channel
representation and program sales
Film Cooking Documentary Spanish Pop Music DIY
Families & Kids Women 30-54 Individuals 25-55 Individuals 13-24 Women 30-54
SpainSpain
AngolaMozambique
SpainPortugalAngola
MozambiqueCape Verde
SpainAngola
Mozambique
SpainAngola
Mozambique
Channel Brands
Genre
Target Audience
Countries
Key Channels Offering
Key Movie Rights
___________________________Source: Company data, Website, Press.1. Canal Panda launched in March 2011.
Cape Verde
Film Film/Action Film/Spanish Film/Indie Entertainment Documentary Kids
Individuals35+ Men 12+ Individuals 45+ Individuals 20+ Individuals
20-45/Adult Individuals 4+ Kids 2-7
Spain Spain Spain Spain Spain Spain Spain
Channel Brands
Genre
Target Audience
Countries
(1)
17
Chello Multicanal Joint Ventures
(1) (2)
Documentary Documentary Documentary Film Kids Kids Entertainment
Men 25-54 Women 25-54 Men 25-54 Families & Kids Kids 2-7 Kids 8-13 Men 25-54
Portugal Portugal Portugal Portugal Portugal
Channel Brands
Genre
Target Audience
PortugalSpain
& 5 in Africa
PortugalSpain
& 5 in AfricaSpain Portugal
PortugalAngola
Mozambique
PortugalAngola
Mozambique
PortugalAngola
Mozambique
___________________________Source: Company data, Website, Press.1. 50-50 Chello Multicanal Joint-Venture with A&E Television Networks.2. 50-50 Chello Multicanal Joint-Venture with Zon.
Countries
18
Chello Latin America Overview
� Chello Latin America is a producer and distributor of thematic Pay TV channels for the Latin America market
� Chello Latin America’s channel portfolio includes10 consolidated channels across 5 different genres
� In September 2012 Chello Latin America gained full control of MGM
� January 2013: Chellomedia launched Chello Latin America as a new operating business
� The combined footprint of the existing portfolio is 124 million TV households in the region
� September 2012: Chellomedia acquired the remaining 50% stake of
Provider of Pay TV channels in Latin America
Overview Recent News
� In September 2012 Chello Latin America gained full control of MGM channels in the region, after Chellomedia acquired 100% of MGM Networks� MGM Latin America Channels were previously operated as a joint
venture� Chellomedia continues to run the channels under the MGM brand
� Other services that the company provides include channel representation
� September 2012: Chellomedia acquired the remaining 50% stake of Cosmo TV from Hearst Corporation
� August 2012: Chellomedia acquired MGM Networks for an estimated value of $100m(1), strengthening its position as a leading producer and distributor of television channels
Film Film Film Arts Sports
Adults Adults Adults 25+ Adults 20+ Men 18+
Channel Brands
Genre
Target Audience
Key Channels Offering
___________________________Source: Company data, Website, Press.1. $100m estimate based on Financial Times article of 2 August 2012.
Adults Adults Adults 25+ Adults 20+ Men 18+Target Audience
Lifestyle Lifestyle Cooking Film/Arts Lifestyle
Women 18-35 Women 18-35 Adults 25+ Adults 25-50 Women 18-55
Channel Brands
Genre
Target Audience
19
Chello Benelux Overview
� Chello Benelux is the leading supplier of premium film and sports channels to the Dutch TV market
� Channel offering includes:
Overview Key Channels Offering
Channel Brands
Preeminent provider of premium channels in the Neth erlands
� Film1 channel that has exclusive pay television output deals with key Hollywood studios
� Sport1 channel that has exclusive pay television rights for a variety of sports
� Digital Media Centre (DMC) in Amsterdam is a provider of TV distribution, playout and other related technical services
� January 2013: The total number of subscribers to Chellomedia’s Film1 and Sport1 premium channels reached 525,000, a growth of 7% year over year
� January 2012: Chellomedia’s Dutch premium channels Film1 and Sport1 have announced a 7% growth in subscriber numbers bringing the total to 490,000 for the year ended December 2011
Recent News
Film Sport
Adults 20-49 Adults 20-55
Genre
Target Audience
___________________________Source: Company data, Press.
Netherlands NetherlandsCountries
Key Broadcasting Rights
Sports
Movies
20
Strategic Alternatives
Strategic Alternatives
Options PROS CONS
100% Acquisition
� The least complex to execute
� Ability to extract synergies
� Need to pay for control premium
� Not all assets are attractive for Sony
� Could consider back-to-back asset disposal
� Significant cash outlay for arguably non-strategic / core assetsassets
� Potential tax leakage for LGI from the crystallisation of a capital gain on the disposal – to be further investigated
Acquisition of a Stake
� Less cash outlay upfront � More complex to execute e.g. shareholder agreements
� Less ability to extract synergies
� Uncertainty for Sony investors re. strategic intention
Acquisition of Assets
� Less cash outlay upfront
� Flexibility for Sony to ‘cherry-pick’ e.g. potential to pick up higher growth assets in CEE and Latin America
� Assets could be carved out by geography – decentralised units with separate HQs
� Nonetheless, carve-out process could be long and costly
� Unlikely to be attractive for LGI as risk of retaining undesired assets
Exe
cutio
n C
ompl
exity
undesired assets
JV / Partnership
� Potential to capture strategic upside without significant cash outlay
� Room for price negotiation without a material premium as LGI participates in upside going forward
� Most complex to execute e.g. JV agreements
� Delays monetisation for LGI
� Requires consistent strategy and investment horizon
� Question on which assets to contribute for a successful JV
21
Potential Buyers
Company Strategic Rationale Key Decision MakerArea of Potential Interest
CEE WE Lat-Am All
� International growth is a priority� Substantial content syndication synergies
� Josh Sapan, CEO� Sean Sullivan, CFO� John Hsu, Head of M&A
� � � �
� Currently partner with Chello in the UK� Provides platform for international growth� Diversified business away from advertising
� Joe Ianniello, CFO� Byron Rubin, Head of M&A � � � �
Potential Buyers – Strategics Tier 1
� Adds international portfolio of content � Provides international distribution for NBCU content
� Brian Roberts, Chairman & CEO� Michael Angelakis, CFO & Vice
Chairman� Bob Pick, Head of M&A� Jeff Shell, Chairman NBCU
� � � �
� Adds scale to existing international presence – top priority� Made significant acquisitions in Europe during 2012 (SBS Nordic, Eurosport,
Switchovermedia
� Mark Hollinger, President and CEO� Bruce Campbell, Chief Development
Officer� James Rosenstock, Head of M&A� Nikhil Bahel, Corp Dev EMEA
� � � �
� Expansion of content / distribution� Seeks to expand PayTV channel portfolio
� Chase Carey, President� James Murdoch, Chairman and CEO
News International� Jan Koeppen, COO Europe and Asia
� � � �
� Real interest and now building out an international channels business organically� Limited headroom to grow domestically and flush with cash
� Nicholas Ferguson, Chairman� Jeremy Darroch, CEO� Andrew Griffith, CFO
� � - -
� Seeking an aggressive entry into the European market� Jeff Bewkes, Chairman & CEO� John Martin, CFO
Pot
entia
l Buy
ers
� Seeking an aggressive entry into the European market� Reduces dependence on film� Already a 49.9% shareholder in CME
� John Martin, CFO� James Burtson, SVP� Michael Del Nin, SVP� Gerhard Zeiler, CEO Turner
� � � �
� Strategic intent to build its Pay TV business, including internationally� Difficult for ITV as no existing international channels business to build scale and synergies� Big cheque: has capacity but high hurdle for significant acquisition away from home market
� Archie Norman, Chairman� Adam Crozier, CEO� Ian Griffiths, Finance Director
� � - -
Pot
entia
lP
artn
ers
22
Company Strategic Rationale Key Decision MakerArea of Potential Interest
CEE WE Lat-Am All
� Already a partner with Chello� Expedites international growth plans� JV with UKTV
� Ken Lowe, CEO� Joseph NeCastro, CFO & CAO � � � �
� Potential synergies with existing European cable channels
� Philippe Dauman, CEO� Wade Davis, CFO & EVP Corp.
Development� Doug Selin, VP M&A
� � � �
Potential Buyers – Strategics Tier 2
� Doug Selin, VP M&A
� Currently trying to sell all telecom assets and re-position the group as a global media company� Keen to get exposure in emerging markets� Familiar with premium movies and sports channels
� Jean Rene Fourtou, Chairman & CEO� Philippe Capron, CFO� Regis Turrini, SVP M&A� Boris Patronoff, Director
� � � �
� 91.6% controlling shareholder preparing secondary offering in RTL in order to re-allocate the overall Bertelsmann portfolio
� RTL management keen to expand geographic presence, with focus on subscription-based channels
� No presence in LatAm to date, though Bertelsmann keen to increase its presence there� Unclear if Bertelsmann would support acquisition
� Guillaume de Posch, co-CEO� Thomas Rabe, RTL chairman and
Bertelsmann CEO & charimann� Thomas Hesse, Head of Bertelsmann
Corp Dev
� � (�) (�)
� Provides additional distribution platform for exploitation of its global brands� Has historically been very acquisitive and paid high multiples for premium content
� Kevin Mayer, Head of M&A � � � �
� Recent film success paves path for international expansion� Diversification away from production into more stable, fee-based revenue
� Jon Feltheimer, CEO� Michael Burns, Vice Chair
� � � �
For
who
le
23
Company Strategic Rationale Key Decision Maker
Area of Potential Interest
CEE WE Lat-Am All
� Despite recent geographic retrenchment (sale of SBS Bene, SBS Nordic, P7 Hungary), P7 management interested in geographic expansion
� Key attraction would be Chello’s high contribution of carriage fees
� Axel Salzman, CFO� Ralf Schremper, Head of M&A (�) (�) - -
� Track record of expanding geographically through acquisitions and keen to diversify from advertising revenues
� Good fit with Chello’s CEE presenceShareholder agreement between Ron Lauder and Time Warner to expire in May 2013, at which
� Adrian Sarbu, CEOMark Wyllie, VP Corporate Finance � - - -
Potential Buyers – Strategics Tier 2
� Shareholder agreement between Ron Lauder and Time Warner to expire in May 2013, at which point TWX would get access its 49.9% voting rights
� Company would need support from TWX to fund any acquisition
� Mark Wyllie, VP Corporate Finance � - - -
� Following ill-timed acquisition of Nova in Bulgaria (07/08), Company is open again to expand geographic footprint
� No presence in LatAm, but through sister company Millicom
� Jørgen Madsen Lindemann, CEO� Stefan Wallenberg, Head of M&A � - (�) -
� Major Polish commercial TV network� No international expansion to date
� Bruno Valsangiacomo, Board member� Markus Tellenbach, CEO � - - -
� Dogan family has fire power of approx $1bn� Main interest is to expand presence across CEE� Multiple decision makers in the family increases execution uncertainty
� Begum Dogan� Hanzade Dogan, � - - -
� Greek-based FTA and Satellite Pay-TV broadcaster� Chello offers attractive complementary CEE exposure
� Theodore Kyriakou, Vice Chairman � - - -
For
par
ts o
nly
� Increased scale trough acquisition of Chellomulticanal Spain � Potential regulatory restrictions
� Massimo Musolino, MD - � (�) -
� Increased scale trough acquisition of Chellomulticanal Spain � Potential regulatory restrictions� Financially constraint - might not have sufficient capacity for cash acquisition
� Silvio Gonzales Moreno, CEO - � - -
� increased scale trough acquisition of Chellomulti canal Spain � Potential regulatory restrictions� Insufficient financial capacity for cash acquisition
� Fernando Abril, CEO - � (�) -
24
Company Relevant Media Investments Key Decision Maker
� Len Blavatnik
� Christian Stahl
Potential Buyers – Financial Sponsors
� Christian Stahl
� Rob Reid
� Justin Chang, Principal� Richard Nanula, Principal
� Lorne Somerville
� Frank Botman
� John Hahn� John Hahn� Andrew Tisdale� Michael Dominguez
� Philip Freise, Partner
� Anil AmbaniPictures
50%
25
Sector Valuation
Comparable Companies Performance Analysis
% Subscription Revenues (6)
EBITDA Margin 2013
36%
EBITDA Growth ’12A-13E
24%
% Revenue from Emerging Markets
8% 61%
US
Com
para
bles
Revenue Growth ’12A – 13E
13%(1)
15%
17%
44%
44%
(11%)
0%
6%
16%
26%
100%
2%
36%
50%
12%
30%
49%
US
Com
para
bles
Eur
opea
nC
ompa
rabl
es
1%
(3%)
9%
24%
(4)
(2)
(3)
(5)
___________________________Source: Company information, Brokers reports, FactSet, Barclays analysis.1. AMC: Emerging Market revenue defined as non-US.2. Discovery: Emerging Markets revenue includes EMEA (exc. UK ) and LATAM.3. Scripps: Emerging Market revenue defined as non-US.4. CME: All revenues emerging markets-based and derived from advertising (broadcast) and content production/ distribution.5. MTG: Financials includes DTH platform revenues and Emerging market revenues defined as Baltics, Czech Republic, Bulgaria, Hungary and Ghana.6. Includes revenue from distribution.
32%
0% 20% 40% 60%
9%
(25%) 0% 25%
100%
0% 50% 100%
14%
0% 50% 100%
Eur
opea
nC
ompa
rabl
es
(3%)
(20%) 0% 20% 40%
26
Comparable Companies Trading Multiples
EV / 2013E EBITDA P / E 2013E
13.8x13.1x
12.5x11.1x10.9x
10.0x9.1x 9.0x
7.9x10x
12x
14x
16x
Median: 9.1x
23.5x
20.8x20.3x18.9x
16.6x
14.2x14.0x12.9x12.9x12.4x11.5x
15x
20x
25x
Median: 14.2x
EV / 2014E EBITDA P / E 2014E
NM(2)NM(2) NM(2) NM(2)
7.9x6.6x
5.3x 5.2x4.4x
0x
2x
4x
6x
8x
MS DISC AMC MTG CME SNI ITV P7S1 TVN RTL CTC M6 TF1 T5 A3
12.9x12.9x12.4x11.5x
0x
5x
10x
15x
DISC TVN AMC SNI P7S1 M6 MTG RTL ITV TF1 CTC A3 T5 MS CME
13.5x
11.7x11.5x
9.6x 9.2x 9.0x 8.6x 8.6x7.6x
10x
12x
14x
16x
Median: 8.4x
21.4x20.2x
18.9x17.4x16.9x
15.1x14.6x13.5x13.0x12.3x12.0x11.7x
15x
20x
25x
Median: 14.6x
NM(1) NM(1)
___________________________Source: Company filings, Barclays estimates and broker research. Market data as of 10 May 2013.1. Value considered non meaningful as over 18.0x.2. Value considered non meaningful as over 30.0x.
European FTA US group CEE group
NM(1) NM(2) NM(2)
7.6x6.3x
5.4x 5.0x 5.0x 4.6x
0x
2x
4x
6x
8x
A3 DISC AMC CME SNI MTG ITV P7S1 TVN RTL MS M6 CTC TF1 T5
Median: 8.4x 13.0x12.3x12.0x11.7x11.0x
0x
5x
10x
15x
MS A3 DISC AMC SNI P7S1 TVN M6 TF1 RTL ITV MTG CTC T5 CME
27
EV/EBITDA (Acquisition Year)
20.0x20x
25x
Relevant Precedent Thematic Channels TransactionsEV (LCY m) $3,500 $37,250$975 €850€70€1,325£65€1,255£160 $19,306$500$3,025
(1)
$410$1,200 £586
11.8x
10.2x
12.4x13.5x
16.6x
11.8x12.4x
10.1x 9.7x
14.2x
12.9x
8.8x
10.5x
11.7x
0x
5x
10x
15x
Mean: 12.4x(1)(1)
(2)
(2)
0x
Jul-08 Nov-09 Dec-09 Jun-10 Mar-11 Apr-11 Aug-11 Mar-12 Jul-12 Dec-12 Dec-12 Dec-12 Jan-13 Jan-13 Feb-13
___________________________Source: Company data, SNL, M&A Monitor, brokers’ consensus estimates.Note: Exchange rate at time of transactions. Kroenke’s acquisition of Outdoor Channel Holdings not included as multiple over 20.0x.1. Represents EV as a multiple of 1-yr forward EBITDA.2. Represents OCF multiple.
Asset
Acquiror
BeNE
(20% Stake)
(20% Stake)Nordic
Television(50% Stake)
28
Appendices
Trading Comparable Companies AnalysisEuropean Trading Comparable Companies Analysis
($ in millions, except per share data)Enterprise Value / Equity Value / P/E Net Debt /
Price as of % Weekly % YTD % of 52 Market Enterprise 2013E 2014E 2013E 2014E LFYCurr 05/10/13 Change Change Week High Cap Value EBITDA EBITDA LFCF LFCF 2013E 2014E EBITDA
Atresmedia EUR 4.80 0.0% 23% 96% 1,221 1,392 27.4x 13.5x 44.4x 15.9x 45.5x 20.2x 3.4x
CETV USD 2.83 6.8% (54%) 36% 250 1,336 10.9x 9.6x nm nm nm nm 8.8x
CTC Media USD 11.74 3.3% 51% 87% 1,857 1,682 5.3x 5.0x 14.2x 13.4x 11.5x 11.0x nm
ITV GBP 1.31 5.7% 24% 98% 7,970 8,503 9.1x 8.6x 15.4x 13.0x 12.9x 12.0x nm
US Trading Comparable Companies Analysis($ in millions, except per share data)
Enterprise Value / Equity Value / P/E Net Debt /Price as of % Weekly % YTD % of 52 Market Enterprise 2013E 2014E 2013E 2014E LFY
ITV GBP 1.31 5.7% 24% 98% 7,970 8,503 9.1x 8.6x 15.4x 13.0x 12.9x 12.0x nm
M6 EUR 13.01 1.7% 10% 95% 2,124 1,715 5.2x 5.0x 14.0x 13.5x 14.2x 13.5x nm
Mediaset EUR 2.21 6.0% 42% 100% 3,261 5,938 13.8x 5.4x 12.1x 9.4x nm 21.4x 5.2x
MTG ¹ SEK 282.50 0.2% 25% 84% 2,853 2,165 11.1x 9.0x 27.1x 20.7x 14.0x 11.7x 0.0x
ProSieben Sat.1 EUR 30.01 0.2% 41% 97% 8,332 9,065 9.0x 8.6x 16.7x 15.1x 16.6x 15.1x 0.3x
RTL EUR 57.11 2.2% (24%) 77% 11,592 10,542 6.6x 6.3x 11.0x 10.6x 12.9x 12.3x nm
TF1 EUR 7.75 (4.6%) (12%) 81% 2,124 1,794 4.4x 4.6x 11.7x 12.0x 12.4x 13.0x nm
Telecinco EUR 6.34 1.3% 25% 98% 3,294 2,608 31.5x 23.5x 62.3x 37.9x 45.1x 33.3x nm
TVN PLN 8.99 7.3% (9%) 87% 966 1,252 7.9x 7.6x na na 20.8x 14.6x 5.4x
Mean 11.9x 8.9x 22.9x 16.1x 20.6x 16.2x 3.8xMedian 9.1x 8.1x 14.8x 13.4x 14.1x 13.5x 4.3x
___________________________Source: Company data, brokers’ consensus estimates, FactSet. Market data as of 10 May 2013.1. Includes Stake in CTC Media.
Price as of % Weekly % YTD % of 52 Market Enterprise 2013E 2014E 2013E 2014E LFYCurr 05/10/13 Change Change Week High Cap Value EBITDA EBITDA LFCF LFCF 2013E 2014E EBITDA
AMC USD 66.64 4.1% 35% 94% 5,011 6,904 12.5x 11.5x 29.8x 16.9x 20.3x 17.4x 3.4x
Discovery USD 78.68 (0.7%) 24% 97% 28,667 31,901 13.1x 11.7x 21.3x 19.7x 23.5x 18.9x 1.7x
Scripps USD 68.99 (0.5%) 19% 97% 10,530 11,029 10.0x 9.2x 19.8x 18.9x 18.9x 16.9x 0.9x
Mean 11.8x 10.8x 23.7x 18.5x 20.9x 17.7x 2.0xMedian 12.5x 11.5x 21.3x 18.9x 20.3x 17.4x 1.7x
29
European Precedent Thematic Channels TransactionsEuropean Thematic Channels – Comparable Transaction Precedents
(2)
(1)
Announcement Percentage Firm Value FV Multiples (Acquisition Year)
Date Acquiror / Target Acquired (LCm) Revenues EBITDA EBIT
Dec 12 Discovery Communications / Eurosport (TF1) 20.0% c.€850 NA 14.2x NA
Dec 12 Discovery Communications / TV Breizh, Histoire, Ushauaia TV, Stylia (TF1) 20.0% c.€70 NA 11.7x NA
Dec 12 Discovery Communications / SBS Nordic (ProSiebenSat.1's Nordic TV and radio assets) 100.0% €1,325 3.0x 9.7x NA
Oct 12 Modern Times Group / TV2 Sport 49.0% NA NA NA NA
Sep 12 Chellomedia / Cosmo TV LatAm 50.0% NA NA NA NA
Aug 12 Chellomedia / MGM Networks 100.0% NA NA NA NA
Providence Equity / Home Shopping Europe
(4)
(5)
(6)
(3)
Jul 12 Providence Equity / Home Shopping Europe 85.0% NA NA NA NA
Apr 12 Eros International / B4U Television Network 76.0% $70 NA NA NA
Mar 12 Scripps Networks Interactive / Travel Channel International 100.0% £65 4.1x 12.4x 13.2x
Dec 11 Vivendi (Canal+ Group) / Bolloré Group TV Channels 60.0% €465 NA NA NA
Oct 11 Scripps Networks Interactive / UKTV 50.0% €578 NA NA NA
Jul 11 RTL / Hungarian Thematic Channels 100.0% €160 NA NA NA
Apr 11 Talpa Media Group, Sanoma, Corelio, Woestijnvis / SBS BeNe 100.0% €1,255 3.0x 11.8x NA
Apr 11 Talpa Media Group, Sanoma, Corelio, Woestijnvis / SBS BeNe 100.0% €1,255 3.0x 10.6x NA
Jan 10 Consortium/N24 Media / N24 100.0% NA NA NA NA
Jun 10 Bollore Media / Virgin17 100.0% €70 3.3x NA NM
Jun 10 BSkyB / Virgin Media TV 100.0% £160 NA 13.5x NA
May 10 Telenor / C More 35.0% SEK 2,249 1.4x 20.3x NA
Mar 10 TF1 / NT1 100.0% €480 NA NA NA
Nov 09 Chellomedia / Zon 50.0% NA NA NA NA
Sep 09 CBS / Chello Zone Channels 100.0% NA NA NA NA
Jun 08 TV4 / C More 100.0% €320 2.1x 13.4x NA
Apr 08 HBO / HBO CEE 100.0% £ 49 NA NA NA
Sep 07 Chellomedia / Zone Vision 12.5% NA NA NA NA
Sep 07 Chellomedia / JimJam TV 100.0% €11 NA NA NA
Dec 06 TF1 / AB Groupe 33.5% €742 3.7x NM NA
Sep 06 Chellomedia / Sport1 TV 55.0% €78 NA NA NA
___________________________Source: Company filings, broker equity research, FactSet, Orbis, mergermarket, Dealogic, Factiva.1. Broker estimated value for 20% stake of Eurosport of €170m. Broker estimated 2012E EBITDA of €60m. Discovery also has the option (granted by TF1) of raising its interest to 51% in 2 years’ time. If this option was to be exercised by Discovery, TF1
has a put option to sell the remaining 49% which would increase Discovery’s ownership to 100%.2. Broker estimated value for 20% stake of TV Breizh, Histoire, Ushauaia TV and Stylia channels of €14m. Broker estimated 2012E EBITDA of €6m.3. EV includes £108m of debt that was part of VMed intercompany loan to UKTV.4. Figures are for acquisition of seven Hungarian thematic cable channels plus FTA channel Klub.5. Multiple applies to FTA asset only.6. Multiple applies if print assets included.
Sep 06 Chellomedia / Sport1 TV 55.0% €78 NA NA NA
Aug 07 NBC Universal / Hallmark Channel 100.0% €351 1.8x NA NA
Nov 05 Chellomedia / Spanish Programming (Disney) 100.0% NA NA NA NA
Jun 05 Zone Vision / Encore 100.0% NA NA NA NA
Jan 05 Chellomedia / Zone Vision 87.5% £43 1.8x 9.0x NA
Aug 04 Viacom / Viva 97.8% $402 3.9x NA NA
Sep 04 SBS Broadcasting / C More 100.0% €250 1.4x 10.3x NA
Jan 01 TF1 / Eurosport 49.5% €697 2.9x NA NA
Mean 2.7x 12.4x 13.2x
Median 3.0x 11.8x 13.2x
30
US Precedent Thematic Channels TransactionsUS Thematic Channels – Comparable Transaction Preced ents
($ in millions)
Enterprise Value /Date Enterprise Acq. Yr. + One Yr.
Ann'd Acquiror Target Value EBITDA EBITDA
02/21/13 Comcast NBC Universal $19,306 8.8x NA
01/22/13 WAPA (Azteca Acquisition) Cine Latino 410 12.9x NA01/22/13 WAPA (Azteca Acquisition) Cine Latino 410 12.9x NA
01/02/13 Qatar Media Corporation Current TV 500 NA 20.0x
07/09/12 NBC Universal A&E 3,025 10.1x NA
01/13/12 Lions Gate Entertainment Summit Entertainment 412 NA 7.7x
03/31/11 Sony GSN 1,200 16.6x 15.2x
10/05/10 Televisa Univision 12,800 14.3x 12.3x
12/03/09 Comcast NBC Universal 37,250 13.5x 12.4x
12/03/09 General Electric Vivendi's 20% Stake in NBCU 5,800 NA NA
11/05/09 Scripps Network Interactive / Cox The Travel Channel, LLC 975 10.2x NA
08/27/09 A&E (Disney, Hearst, NBCU) Lifetime Entertainment Services (Disney, Hearst) NA NA NA
04/29/09 Hasbro Inc. Discovery Kids 714 NA NA
01/06/09 Lions Gate Entertainment TV Guide Network 255 NA NA
07/06/08 NBC Universal/Bain/Blackstone The Weather Channel (Landmark) 3,500 NA 11.8x
05/07/08 Rainbow Media Group Sundance Channel 496 24.8x 13.5x
08/29/07 NBC Universal/GE Hallmark Channel Intl (Sparrowhawk) 351 NA NA
___________________________Source: Company data, SNL, M&A Monitor, brokers’ consensus estimates.Note: Exchange rate at time of transactions.
11/01/06 Comcast E! Entertainment (Disney) 3,000 12.4x 12.7x
04/22/03 Viacom Comedy Central 2,450 24.0x 17.5x
11/04/02 NBC Bravo Networks 1,250 25.1x 20.3x
12/17/01 Vivendi USA Networks 11,560 18.0x 17.9x
08/01/01 Comcast Outdoor Life (Fox) 616 NA 34.2x
Median 13.9x 14.4x Mean 15.9x 16.3x
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EV/Revenues EV/EBITDADate Acquiror Target Stake (%) EV (€m) LFY LFY+1 LFY LFY+1
Jan 13 Discovery Communications Switchover Media 100.0% n.a. n.a. n.a. n.a. n.a.Dec 12 Discovery Communications SBS Nordic (ProSiebenSat.1's Nordic TV and radio assets) 100.0% 1,325 3.0x 2.9x 9.7x 9.3xApr 12 Time Warner Central European Media Enterprises 12.5% 1,787 2.0x 1.9x 10.1x 8.4xJan 12 Egmont TV2 AS 50.0% 550 n.a. n.a. n.a. n.a.Jan 12 Dimitris Kontominas Alpha Media Group 70.0% n.a. n.a. n.a. n.a. n.a.Dec 11 Antenna 3 La Sexta 100.0% 269 1.1x 1.1x n.m. n.m.Oct 11 Doğuş Yayın Group Star TV 100.0% 238 2.0x 1.5x n.m. 7.2x
European Precedent FTA Channels TransactionsEuropean Free-To-Air Channels – Comparable Transacti on Precedents
Oct 11 Doğuş Yayın Group Star TV 100.0% 238 2.0x 1.5x n.m. 7.2xJul 11 RTL RTL Klub 31.0% 160 n.a. n.a. n.a. n.a.Apr 11 Talpa Media Group, Sanoma, Corelio, SBS BeNe 100.0% 1,255 3.0x n.a. 11.8x n.a.Apr 11 Talpa Media Group, Sanoma, Corelio, SBS BeNe 100.0% 1,255 3.0x n.a. 10.6x n.a.Nov 10 Cyfrowy Polsat Telewizija Polsat 100.0% 922 3.4x 3.2x 12.3x 11.0xJul 10 Northern & Shell Five Group 100.0% 125 0.4x 0.4x n.m. n.m.Feb 10 CME bTV 100.0% 300 4.6x 4.3x 11.2x 10.5xJan 10 Igor Kolomoisky CME Ukraine 100.0% 213 10.0x 8.5x n.m. n.m.Dec 09 Gestevision Telecinco SA Cuatro 100.0% 550 2.1x 1.8x n.m. n.m.Sep 09 Ongoing Strategy Investments SGPS SA Grupo Media Capital SGPS 35.0% 587 2.1x 2.1x 11.3x 11.5xApr 09 Investment Kinnevik AB Modern Times Group 5.4% 1,513 1.3x 1.2x 7.8x 10.5xMar 09 Time Warner Central European Media Ent. 30.6% 1,306 1.5x 1.9x 5.2x 8.5xNov 08 Dogan Yayin Holding Dogan TV 5.1% 1,499 4.0x 2.7x n.m. n.m.Aug 08 Telegraaf Media Groep (TMG) ProSiebenSat.1 6.0% 9,355 n.a. n.a. 14.2x 11.8xJul 08 Modern Times Group Nova TV 100.0% 621 14.8x 8.6x 30.1x 21.1xMar 08 CTC Media DTV Group 100.0% 257 10.1x 6.7x n.m. n.m.Feb 08 CME Studio 1+1 30.0% 494 5.8x 4.4x 25.8x 17.8xDec 07 KKR & Permira ProSiebenSat.1 12.0% 7,795 2.9x 2.3x 12.9x 9.8xDec 07 Calik ATV-Sabah Economic Unit 100.0% 749 1.3x 1.2x 14.6x 11.6xJul 07 Channel 4 Group Box Television Ltd 50.0% 83 2.1x n.a. 7.5x n.a.Jul 07 Central European Media Enterprises Ltd Markiza TV 20.0% 287 4.4x n.a. 12.6x 11.3xJun 07 ProSiebenSat.1 Media AG SBS Broadcasting Group 100.0% 3,300 3.2x 3.0x 14.8x 13.3x
(1)
(2)
Jun 07 ProSiebenSat.1 Media AG SBS Broadcasting Group 100.0% 3,300 3.2x 3.0x 14.8x 13.3xJun 07 Alisher Usmanov (Private Investor) Muz TV 75.0% 297 13.3x n.a. n.a. n.a.Jun 07 CME Pro TV 5.0% 744 6.7x 5.1x 15.1x 11.8xFeb 07 Access Industries CTC Media 6.1% 2,290 8.1x n.a. 17.4x n.a.Feb 07 MTG Balkan Media Group 50.0% 25 4.7x n.a. 27.1x n.a.
All TransactionsMean 4.5x 3.2x 14.1x 11.6xMedian 3.0x 2.5x 12.4x 11.2x
2009-2013Mean 2.9x 2.6x 10.6x 9.8xMedian 2.1x 1.9x 10.9x 10.5x
___________________________Source: Company filings, broker equity research, FactSet, Orbis, mergermarket, Dealogic, Factiva.1. Multiple applies to FTA asset only.2. Multiple applies if print assets included.
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