MBK Said to Plan Reviving Sale of South Korea Cable Operator C&M

MBK Partners Ltd. and Macquarie Group Ltd. are reviving a sale of their controlling stake in South Korean cable-TV operator C&M Co., according to people familiar with the matter.

MBK, the private equity firm founded by former Carlyle Group LP executives, is working with Goldman Sachs Group Inc. and plans to start the sale next year, the people said, asking not to be identified because the discussions are confidential. MBK and Macquarie, which together own 92.5 percent of C&M, may seek a valuation of about $3 billion, two people said.

MBK purchased control of C&M in 2008 together with a fund managed by Macquarie, Australia’s largest investment bank. The companies bought the holding in two tranches, acquiring 65 percent for 1.46 trillion won ($1.3 billion) in March that year after buying a 27.5 percent stake for 563 billion won in 2007.

Spokesmen for MBK, Macquarie and Goldman Sachs declined to comment.

Started in 2005 by five former Carlyle executives led by Michael Kim, MBK has been trying to exit its cable businesses in Korea and Taiwan. The private equity fund sought to to sell C&M in February 2013, MoneyToday reported at the time, and its latest attempt to dispose of its holding in China Network Systems in Taiwan is currently on hold.

C&M is among the largest cable providers in South Korea with more than 2 million cable-TV subscribers in the greater Seoul metropolitan area, according to MBK’s website. It has annual earnings before interest, taxes, depreciation and amortization of about $300 million, the people with knowledge of the matter said. MBK and Macquarie are seeking a valuation of about 10 times profit on that basis, said the people.

Cable and satellite providers in Asia worth more than $1 billion are trading at a median valuation of about 10 times Ebitda profit, according to data compiled by Bloomberg. CJ Hellovision Co., a local competitor to C&M, trades at 2.6 times earnings, the data show.

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