CME Rallies as Time Warner Buying Shares Shows ‘Confidence’
The stock rose 6.2 percent to 355.8 koruna at its 4:24 p.m. close in Prague, its biggest daily rally since Oct. 11. More than 534,000 shares changed hands, four-times the three-month daily average. In U.S. trading, CME surged 5.9 percent to $20.53 by 11:25 a.m. New York time on the Nasdaq Stock Market.
Time Warner bought 3.1 million shares in Bermuda-registered CME at $19.45 each yesterday, the U.S. media and entertainment group said in a regulatory filing. Time Warner now holds a 34.4 percent stake, which equates to 47.5 percent of voting rights, Deborah Cleaver, investor relations officer at CME in Prague, wrote in response to e-mailed questions from Bloomberg News.
“This is definitely positive news, showing the high confidence of Time Warner in the future development of CME,” equity analyst Vaclav Kminek at Erste Group Bank AG’s Prague- based unit, Ceska Sporitelna AS, wrote in a report today.
CME, which operates television channels in the Czech Republic, Romania, Croatia, Slovakia, Slovenia and Bulgaria, said last month its fourth-quarter net loss fell to $26.1 million from $55.3 million a year earlier as advertisers increased spending. Revenue rose $23 million to $257.4 million.
Time Warner bought a 31 percent stake in the broadcaster for $241.5 million in May 2009, with the agreement that Ronald Lauder, CME’s founder and non-executive chairman, would vote Time Warner’s shares in the company for at least four years.
The first possible date for dissolution of the voting agreement is March 27, 2013, CME spokeswoman Romana Wyllie said in e-mailed answers to questions from Bloomberg News.
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