February 27, 2020 / 5:07 PM / a month ago

CME shareholders approve sale to PPF as US senator questions deal

PRAGUE (Reuters) - Shareholders of Central European Media Enterprises (CME) approved on Thursday the acquisition of the company by Czech investment group PPF, although a U.S. senator has asked authorities to review the deal.

CME’s majority owner, AT&T Inc (T.N), said in October it would sell its stake in the broadcaster in a deal valued at about $2.1 billion, having acquired its share through the acquisition of Time Warner in 2018.

CME boosted revenue and profits in recent years as advertising spending rose, with the Czech and Romanian markets its biggest profit drivers. It also operates television stations in Bulgaria, Slovakia and Slovenia.

Senator Marco Rubio asked the Trump administration on Wednesday to review the national security implications of the deal.

Rubio, a Republican who chairs the bipartisan and bicameral Congressional-Executive Commission on China, wrote in a letter to Treasury Secretary Steven Mnuchin and Attorney General William Barr that PPF has a record of acting as “China’s proxy inside the Czech Republic”.

He added that PPF-owned telecommunication firms are working with Huawei Technologies Co to develop 5G networks.

PPF said in a statement that it appeared Rubio was relying on “false information” from a Czech politician and disputed his characterization of CME’s market. The company said it had only inherited Huawei’s technology as part of its acquisition of the Norwegian telecom operator Telenor last year.

Huawei, which denies its equipment poses a security risk, is at the center of a storm pitting the United States against China over 5G, the next generation mobile technology and Europe has become a major battleground.

Reporting by Robert Muller; Editing by Kirsten Donovan

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