Mergers & acquisitions

: the case Grupo Media Capital and PT Portugal

Abstract

Over the last 2 years, Altice Group has been one of the most active telecommunication companies, making acquisitions in different countries, not only in the telecommunication sector but also in the media sector. According to the multinational company, the expansion into the media industry, in the countries where they have already telecommunication operations, brings many and important synergies to their overall operation. After Altice have bought PT Portugal, some rumors came up about the possibility of Altice also entering in the media market in Portugal. Taking up these rumors I decided to study the potential acquisition of Grupo Media Capital by Grupo Altice, through PT Portugal. Along the thesis, I explain relevant M&A literature, make a review on both sectors (media and telecommunication) and companies, and at the end also calculate the standalone valuation of both companies and the synergies that may arise from this deal. After all these procedures, I conclude that this is the perfect moment for PT Portugal to make an offer to Group Prisa (Grupo Media Capital major shareholder). Grupo Prisa should be willing to disinvest in their Portuguese position and taking into account my calculations, Grupo Media Capital share price is undervalued. PT Portugal should make an offer of €4.84 per share, if considering a premium composed by 75% of the cost reduction synergy and 25% of the advertising revenue synergy.

Date of Award	28 Jul 2016
Original language	English
Awarding Institution	Universidade Católica Portuguesa
Supervisor	Henrique Miguel Ribeiro Guimarães Bonfim (Supervisor)