Modern Times Group (MTB) AB – bid to acquire a majority stake in Starman AS


Recently, TARK competition team advised MTG, an international entertainment broadcasting group, in all competition / regulatory aspects of its bid to buy a majority stake in Starman, the largest supplier of Pay-Tv (cable and DTH platforms) and 2nd largest provider of broadband internet in Estonia.
The regulatory assessment was a crucial part of the bid, because MTG is already active in the

Estonian Pay-Tv market (via its satellite Viasat platform) and also in the upstream markets of wholesale supply of commercial-FTA (TV3) and premium TV channels (TV1000) to other Pay-Tv operators (including Starman, Elion, STV). Thus: adding Starman to MTG’s existing Estonian business raised a number of potential competition issues, which needed to be identified, quantified and addressed.

As part of the regulatory assessment we: (a) identified alternative market definitions and the likelihood of each of those market definitions being adopted by Estonian Competition Authority; (b) identified, and quantified, potential competition issues (both horizontal and vertical) and identified and quantified potential solutions for each issue; and then (b) developed Base Case and Negative Case scenarios with competition issues and potential solutions with business case impact and probability attached to both, i.e. developed a Road Map of the prospective merger review process.