CTC Media Inc. (CTCM), a Russian television company, headed to its biggest weekly decline in a month on speculation its audience and advertising revenue may shrink as Walt Disney Co. (DIS) expands in the country.
CTC Media retreated 1.6 percent to $10.96 at the close of trading in New York, extending its decline this week to 8.6 percent. It was one of three stocks on the Bloomberg Russia-US 14 Index of Russian companies traded in New York that fell today.
Disney agreed to buy a 49 percent stake in a Russian network known as Seven TV that will be renamed the Disney Channel, the Burbank, California-based company said in a statement Oct. 27. Seven TV currently reaches more than 75 percent of Russian homes, including those in the Moscow and St. Petersburg markets. CTC’s channels target a similar audience.
“If Disney is successful in its Seven TV venture, this can potentially lead to a shrinkage of CTC’s audience and advertising revenue,” Alexander Vengranovich, a Moscow-based equity analyst at Otkritie Brokerage, said in a telephone interview. “Disney has a lot of content, a lot of finances, a lot of resources and therefore is a strong competitor to CTC.”
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