Go acquires stake in Cypriot cable television provider
Go plc today entered into a share purchase agreement with Cablenet Communications Systems Limited and Nicolas Shiacolas, beneficial owner of Cablenet’s entire issued share capital.
Through this agreement, Go will purchase 25 per cent of Cablenet’s issued share capital from Mr Shiacolas in exchange for a convertible loan of €12 million to Cablenet.
At Go’s option, this loan may be converted into equity so that, upon conversion, Go’s total shareholding would be equal to 45 per cent of Cablenet’s issued share capital.
Additionally, the agreement also grants Go the option to acquire majority control of Cablenet in the future.
Cablenet is a privately owned business which began operations in 2003 as a cable television provider in Cyprus. It was acquired in 2006 by Mr Shiacolas and since then the company has consistently expanded its network and its operations and was the first Cypriot operator to offer a triple-play package covering TV, fixed telephony and high-speed internet access.
Cablenet is now the leading privately owned broadband provider in Cyprus and offers packages which include broadband internet access, fixed telephony and digital HD TV to more than 43,000 subscribers.
Go CEO Yiannos Michaelides said the investment formed part of the company's clearly stated strategy of seeking opportunities to grow its business, and shareholder value.
"As the potential to achieve this in Malta is restricted, we are open to pursuing such opportunities wherever they may be.
"Cablenet is still a relatively small business but has made great strides in a short space of time and, importantly, has established itself as the provider of premium, high value internet and TV services in Cyprus.
"Cablenet’s clear potential for further growth in the premium sector, combined with the obvious synergies that exist between Go and Cablenet and between Malta and Cyprus, made this an attractive proposition which we have now decided to pursue.”
Mr Shiacolas, managing director and owner of Cablenet, said Cablenet had consistently proven it could provide those services most sought by subscribers and has grown substantially.
"The strategic investment by Go into Cablenet is both a vote of confidence into what Cablenet can deliver in the future, but also in the prospects of the economy of Cyprus in general.
"This is now a partnership which we are confident will deliver results for Cablenet and also for Go as we continue to strengthen our position in the Cypriot market.”
The agreement is subject to approval by the relevant regulatory authorities in Cyprus, following which changes to Cablenet’s board of directors will take effect.
Go will, as part of the agreement, have the option to nominate three directors to the board of Cablenet, as well as appoint the company secretary.