Sanoma Group to divest its interest in teleoperator DNA
The idea behind the move is to strengthen the balance sheet and reduce debt burden
The media group Sanoma announced on Thursday that it is to continue the divestment of its business operations.
This time around, Sanoma will dispose of its interest in the teleoperator DNA.
Sanoma has reached an agreement with the principal owners of DNA over a transaction in which the media group’s entire 21.11% shareholding in DNA Ltd will be sold for a EUR 181.5 million cash consideration, or EUR 89.53 per share.
DNA’s main shareholders are Finda Oy, Oulu ICT Oy, PHP Liiketoiminta Oyj, and Osuuskunta KPY.
According to the group, “as a result, Sanoma will book a non-recurring capital loss of some EUR 17 million at the closing of this transaction, which is expected during March 2012.”
In recent times the Sanoma Group has divested its holdings in a number of companies.
Last year the media giant sold its shares of the Finnkino cinema chain, the Suomalainen Kirjakauppa bookstore chain, and the Finnish general literature publisher Werner Söderström Ltd (WSOY).
Sanoma’s DNA ownership results from a spring 2010 deal in which Sanoma sold the cable operator Welho to DNA. A non-recurring capital gain of EUR 185 million was booked from the deal.
At the time Sanoma announced its intention to remain a long-term strategic proprietor of the company.
The idea behind the change of heart is the group’s intention to centralise its business activities and strengthen its balance sheet while reducing the amount of debt.
In April 2011, Sanoma spent around EUR 1.2 billion on five television channels in Holland and Belgium with its local partners there.
The transaction increased the group’s debt burden by about a billion euros.
Indebtedness tends to increase financial costs and limit growth.
"This transaction is in line with our strategy to focus on consumer media and learning. It also strengthens our balance sheet and enables us to further develop our portfolio," describes Harri-Pekka Kaukonen, President and CEO of Sanoma Corporation.
According to Kaukonen, Sanoma Group’s assets are still under close scrutiny.
For example, the R-Kiosk chain, acquired in connection with the purchase of Rautakirja in 1999, has been for sale for some time.
On Thursday the Sanoma Group’s stock price fell by just over two percentage points on the Helsinki Stock Exchange.
Helsingin Sanomat is part of the Sanoma Group.
Previously in HS International Edition:
Sanoma Group divests its movie operations (22.3.2011)
Sanoma to revamp its organisation (5.8.2011)
Sanoma to sell off publishers WSOY (29.4.2011)
Sanoma press release, 23.2.2012