July 3 (Bloomberg) -- D-Smart, Turkey’s second-biggest digital TV operator, plans to bid in a government auction to sell seized Digiturk, its most formidable rival.
D-Smart, owned by media group Dogan Yayin Holding AS, plans to merge the companies should it win the auction and get antitrust clearance, Chief Executive Officer Ali Guven said today in a telephone interview.
“There will be good synergies if we merge the two companies,” Guven said.
A merger with Digiturk would yield as many as 5 million subscribers, compared with D-Smart’s current base of 1.6 million TV box users and 370,000 Internet subscribers, according to Guven. Digiturk’s customers include 1 million users of Lig TV, which holds Turkey’s Super League soccer rights, he said.
Turkey’s Savings Deposit Insurance Fund, or TMSF, took over Digiturk, formally known as Krea Icerik Hizmetleri & Produksiyon AS, and other media assets from Cukurova Holding AS in May after Cukurova failed to repay a $455 million debt. TMSF chief Sakir Ercan Gul has said the fund may sell the entire company if Providence Equity Partners Inc., a U.S. buyout firm, agrees to sell its 46 percent stake along with Cukurova’s 54 percent.
D-Smart expects a sale process to start soon, Guven said. The company’s formal name is Dogan TV Digital Platform Isletmeciligi AS.
Cukurova, one of three major investors in Turkey’s biggest mobile operator Turkcell Iletisim Hizmetleri AS, will start the sale process under the auspices of TMSF, according to a spokesman for the investor.
Cukurova has already agreed to sell AKS Televizyon Reklamcilik Yayincilik & Filmcilik AS, which owns the Show TV channel, for $402 million to a Ciner Holding unit.
D-Smart has sales of more than 500 million liras ($257 million) a year and Digiturk’s revenue is about 1.3 billion liras, Guven said. Digiturk declined to comment on sales and subscriber numbers.
D-Smart has a two-year agreement with Dogus Holding AS’s NTV Spor that allows it to show Spanish La Liga soccer games on its pay channels, Guven said. Dogus, which owns CNBC’s Turkish version and news channel NTV, is also interested in buying Digiturk, Milliyet reported June 4.
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