Government green-lights cable TV operator sale

The China Post news staff and CNA

The government yesterday approved the acquisition of Kbro Co. (凱擘), Taiwan’s largest cable TV operator, by Daniel Tsai and his brother Richard, scions of one of Taiwan’s richest families, from U.S. private equity firm the Carlyle Group.

The latest acquisition will make the Tsai family’s media company the largest cable TV network in Taiwan, with 12 cable television systems. The Tsai family’s acquisition of Kbro via the recently established Da-fu Media will give it Kbro’s 80 percent stake in 12 local cable television systems, said Hwang Jung-chiou, head of the Investment Commission under the Ministry of Economic Affairs (MOEA), at a press briefing. Kbro keeps the other 20 percent share in the deal worth NT$36 billion (US$1.2 billion).

The buyer received key approval from the National Communications Commission (NCC) last month after it clearly outlined its plan for developing a platform for digital TV and providing consumers with better quality programs.

Da-fu will spend NT$5.2 billion investing in digital TV, extending its coverage from the current 10.6 percent to 16 percent next year, 50 percent by 2015 and 74 percent by 2017, a goal set by the government. Kbro now has more than 1 million cable television subscribers countrywide. Daniel Tsai is also the chairman of Fubon Financial Holding Co., Taiwan’s second-largest financial services provider. As the Fubon Group will soon control a good majority of news and financial channels, the NCC had prerequisites that Da-fu had to meet in order to avoid media monopoly and the vertical integration of businesses. The NCC also had stipulations against any overt signs of Fubon Group promotions on the Da-fu channels. The media group may not invest in any satellite broadcast TV channels within the year and cannot control any satellite TV business networks within the next three years.