FINANCE FILL, WITH ART (UPC.BMP, in Bank)
UPC to Buy Polish Op At Entertainment
By MIKE GALETTO
In its largest acquisition to date, United Pan Europe Communications N.V. (UPC) said last week that it agreed to buy At Entertainment Inc., Poland's top pay TV provider, for $1.15 billion.
The purchase is a huge move into Eastern Europe for UPC, Europe's top private cable operator.
At Entertainment's cable systems have 948,150 subscribers, and they pass almost 1.7 million homes. Its Wizja TV direct-to-home platform, which launched last October, has about 130,000 subscribers.
UPC said it will pay $19 per share in an all-cash offer for At Entertainment -- a 52 percent premium to its closing price June 1, the day before the deal was announced.
UPC, the European unit of United International Holdings Inc., said shareholders owning 51.7 percent of At Entertainment's outstanding common stock have agreed to sell their shares.
The purchase price includes the assumption of $400 million of At Entertainment's debt.
"At Entertainment is a critical addition to our pan-European strategy," UPC CEO Mark Schneider said in a prepared statement, adding that UPC plans to roll out its "Chello" broadband-internet service and "Priority Telecom" telephony service in Poland.
UPC added that 73 percent of At Entertainment's subscribers are served by 860-megahertz plant, further aiding the rollout of its "triple play" of video, voice and data services.
At Entertainment's interests also include programming and sports rights.
However, the company has been saddled with high debt levels, and industry sources had said that it would have had trouble borrowing further funds.
And despite the huge run-ups of U.S. and international cable-company share prices, At Entertainment's shares had lagged at or below $10 each for much of the past 10 months. Last week's announcement pushed the price up 44.5 percent, to $18.06.
UPC -- which is 7.8 percent-owned by Microsoft Corp. -- went public in February. It has emerged as Europe's most aggressive MSO, and it is a leader in the region's increasingly consolidating pay TV market.
But other firms snapped up two cable properties that it had eyed: Ireland's Cablelink Ltd. and Germany's Telecolumbus.