Struggling facility Molinare, the post arm of The TV Corporation, has been bought in an MBO for just£10, writes Sam Espensen.
After months of speculation over its future, MD Mark Foligno and sales and marketing director Steve Milne have bought a majority stake in the company, with Milne owning the bulk. The TV Corp still has a 19.9% interest in the company which is now called Molinare Productions, but is not committed to providing funds.
Although the city sees the move as a good one for The TV Corp, perversely the company's share price has dropped by 14%, from 81p to 70p since the announcement. City analyst Carl Franklin, who predicted that the TV Corp would be better to sell Molinare before the next financial year (Broadcast 29 August 2003), said that he "would have expected to see shares go up at least 10%. This is a recovery story after all." Franklin added that he believes the sale is "good for everyone concerned. It's going to be a tough couple of years for Molinare but it's been taken over by an entrepreneur who wants to make a go of it." He added that The TV Corp has "got rid of a loss making subsidiary, and can now focus on being a super-indie."
It is understood that The TV Corp has written off£4.3m of Molinare's debt, after the company traded at a£1m loss earlier this year. In 1995, when Sunset and Vine bought out Molinare just prior to the formation of The TV Corp, Molinare was valued at£18m.