RMG.L Regulatory News (RMG)

24 Oct 2006 18:06

RAMBLER MEDIA SELLS TV BUSINESS Rambler Media Limited ("Rambler Media" or "the Company"), a leading provider ofinternet and multimedia services to the global Russian-speaking community, todayannounced the sale of its TV business 'Rambler TV' to Osgora ProductionsLimited, a 100% subsidiary of Prof-Media, a Russian media holding company. Thetotal consideration will be announced at the completion of the transaction afterreceipt of the regulatory approvals. The disposal reflects Rambler Media's strategy to concentrate on growing itscore Russian language internet business, which generates the majority of theCompany's total revenue. The sale proceeds will be used by Rambler Media topursue its growth strategy, which may include the selective acquisition ofcash-generative businesses that complement Rambler Media's core internetbusiness activities. Prof-Media is making the acquisition in the interests of its Moscow-based '2x2'start up TV-channel, thereby broadening its coverage including Saint Petersburg. Rambler TV is a free-to-air channel, which holds a national broadcasting licensein Russia and reaches approximately 40 million people (33% of all Russianhouseholds) through a network of around 900 local affiliate stationsbroadcasting in around 470 towns and cities across Russia. The network owns astation in Saint Petersburg, the second largest advertising market in Russiaafter Moscow. In the first half of 2006, Rambler TV had a national share of viewing of 0.43%(6-54 age group). Rambler TV generated US$ 2.15 million of revenue (14% ofRambler Media's total revenue) and an EBITDA loss of US$ 1.4 million for thefirst half of 2006. The channel reported US$ 2.8 million of revenue and anEBITDA loss of US$ 3.27 million for the full year 2005. Irina Gofman, Chief Executive Officer of Rambler Media, commented: "Althoughrevenues from Rambler TV more than doubled in the first half of 2006 compared tothe same period of last year, we believe that it will benefit from an owner withmore TV assets and particularly with a Moscow frequency. Our strategic focus isto accelerate the development of our internet assets and further consolidate ourmarket-leading position in the Russian language internet market. Our primaryportal, Rambler.ru, is one of the most visited internet resources for theRussian speaking community, attracting over 21 million unique visitors eachmonth and making Rambler an essential partner for advertisers. Some of our newcommunity-based initiatives include Rambler Vision (http://vision.rambler.ru/),which is proving enormously popular and provides users with the chance to share,search and discuss amateur and professional video content, as well as RamblerPlanet (http://planeta.rambler.ru/), which offers videoblogging services. We have recently celebrated Rambler's tenth anniversary and our strategy is tocontinue to be a pioneer in the Russian internet market moving forward, byoffering the highest quality selection of online products and services,including multimedia search, communication, entertainment, information ande-commerce through our powerful and well recognised brands. Video content is animportant aspect of this strategy and we will continue to explore the extensiveopportunities that exist in TV content through alternative platforms such asIPTV and others." Rafael Akopov, CEO of Prof-Media commented: "This acquisition is a major step inbroadening 2x2's broadcasting territory. 2x2 will become 'a channel of twocapitals', with young and active inhabitants of major cities forming its coreaudience. Besides, Rambler TV's regional network has a standalone value for theholding. The new channel is scheduled to launch in 2007." The parties agreed to pursue cross-promotional opportunities between respectiveInternet and TV resources. For further information, please visit www.ramblermedia.com or contact: \* TRambler Media Shared Value LimitedIrina Gofman Nicolas DuperrierTel. +7 495 500 3826 Tel. +44 (0) 20 7321 5010 rambler@sharedvalue.netING Wholesale BankingDaniel FriedmanWilliam MarleTel. +44 (0) 20 7767 1000 Prof-MediaKonstantin Vorontsov+7 495 787 5335kvorontsov@profmedia.ru\* T ABOUT RAMBLER MEDIA Rambler Media is an integrated and diversified Russian language media,entertainment, services and content delivery company which operates variousinternet properties including the leading Russian language internet portal andsearch engine 'rambler.ru', on-line newspaper 'Lenta.ru', broadband ISP 'RamblerTelecom', interactive advertising company 'Index20', and mobile content serviceprovider 'Rambler Mobile'. Rambler Media's shares are traded on the AIM marketof the London Stock Exchange under the symbol 'RMG'. For more information onRambler Media, visit our corporate website at www.ramblermedia.com. ABOUT PROF-MEDIA Prof-Media holding was established in 1997 and today it is one of the largestand most diversified media holdings in Russia, one of the leaders in thenewspaper, magazine, radio and cinema markets, with a consolidated turnovertopped US$240 million in 2005. The holding is a major private investor in the Russian cinema industry,operating a nationwide cinema exhibition chain 'Cinema Park' along withproduction and distribution company 'Central Partnership'. The holding owns acontrolling stake in newspaper company 'Komsomloskaya Pravda', a magazinepublishing house 'Afisha', and a b2b publisher 'B2B Media'. Prof-Media runs fourFM-frequency radio stations, a number of internet portals and community builderssuch as 'Afisha.ru' and 'E-xecutive.ru', and TV-channel '2x2', that will hit theair in April 2007. For more information on Prof-Media, visit the corporatewebsite at www.profmedia.ru. Certain statements within this announcement constitute forward lookingstatements. Such forward looking statements involve risks and other factorswhich may cause the actual results, achievements or performance of the Companyto be materially different from any future results, achievements or performanceexpressed or implied by such forward looking statements. Such risks and otherfactors include, but are not limited to, general economic and businessconditions, changes in government regulations, and court interpretations of suchregulations, currency fluctuations (including the US$/Rbs rate), competition,changes in development plans. There can be no assurance that the results andevents contemplated by the forward looking statements contained in thisannouncement will, in fact, occur. Any forward looking statements made in thisannouncement represent management's best judgment as to what may occur in thefuture and are correct only as at the date of this announcement. The Companywill not undertake any obligation to release publicly any revisions to theseforward looking statements to reflect events, circumstance or unanticipatedevents occurring after the date of this announcement except as required byapplicable law or by any applicable regulatory authority. Copyright Business Wire 2006