MTG acquires Swedish communications operator

Modern Times Group MTG AB (publ.) (‘MTG’ or ‘the Group’), the international
entertainment broadcasting group, today announced that it has signed an
agreement  to acquire 80% of Zitius Service Delivery AB (‘Zitius’) from
Quadracom AB for an undisclosed cash consideration. The agreement also provides
for the acquisition of the remaining 20% of Zitius in 2016. Zitius is Sweden’s
leading independent Open Access Communications Operator, with approximately
150,000 connected fibre households.  Of these, over a third currently subscribe
to a service via Zitius network.
The Open Access network structure is specific to the Swedish broadband market
and provides an open environment where multiple service providers can sign
agreements with the network operator to market their services to the end
consumer, typically in multi-dwelling residential apartment buildings in towns
and cities. Approximately 750,000 homes, or 16% of all Swedish households, are
estimated to be currently connected to Open Access networks. The deployment and
expansion of the networks since 2000 have been subsidised by Swedish local and
national Government and the European Union.

Zitius was established in 2003 as an independent communications operator of
Swedish Open Access broadband networks, and has multi-year agreements with
infrastructure owners such as local Swedish councils and real estate
organisations. Zitius provides network management and service packaging
services, and installs, owns and operates the active network equipment including
routers and switches, but typically does not operate the equipment on consumer
premises. Zitius has agreements with a broad range of third party providers of
telephony, data and TV services, who market their services to homes within the
networks that Zitius operates. MTG’s Viasat Broadcasting is already one of these
providers.

Zitius generated pro forma revenues of SEK 96 million for the full year 2011,
with SEK 14 million of EBITDA and an EBIT of SEK 6 million adjusted for non
-recurring items. Pro forma CAPEX for the full year 2011 amounted to SEK 10
million. The Company generated pro forma sales of SEK 66 million for the first
six months of 2012, with an EBITDA of SEK 20 million and an EBIT of SEK 12
million. CAPEX for the first half of 2012 amounted to SEK 14 million.

Hans-Holger Albrecht, President and CEO of MTG, commented: “The acquisition of
Sweden’s number one operator of Open Access broadband networks reflects our
commitment to invest in and support the roll-out of high speed platforms that
broaden the availability and increase the consumption of our content. Video is
the primary driver of internet traffic and that demand is only growing. Zitius
is a high growth market leader in a fast growing segment that also delivers
attractive profitability levels. Our intention is to strengthen Zitius’ market
leading position even further, and to continue providing attractive offerings to
customers from multiple suppliers in an open environment. We will continue to
market our own Viasat channels and Viaplay service to consumers through as many
platforms as possible.”

Roy Forslund, CEO of Quadracom commented: “This deal is perfectly in line with
our strategy to enhance Zitius’ position as the leading and only credible
independent operator of open access broadband networks in Sweden. Becoming a
part of MTG, Sweden’s leading premium content provider, will significantly
strengthen the Company’s position and give it the power to fulfil the vision to
offer the broadest, locally tailored and most exciting services for the benefit
of our existing and future network owner customers and all those who are
connected to open access broadband networks managed by Zitius.”

* * *
For further information, please visit www.mtg.se or contact:

Hans-Holger Albrecht, Chief Executive Officer
Tel:                              +46 (0) 8 562 000 50

Matthew Hooper, Head of Corporate Communications & Planning
Tel:                               +44 (0) 7768 440 414
Email:                           investor.relations@mtg.se / press@mtg.se
Modern Times Group (MTG) is an international entertainment broadcasting group
with operations that span four continents and include free-TV, pay-TV, radio and
content production businesses. MTG’s Viasat Broadcasting operates free-TV and
pay-TV channels, which are available on Viasat’s own satellite platforms and
third party networks, and also distributes TV content over the internet. MTG is
also the largest shareholder in CTC Media, which is Russia’s leading independent
television broadcaster.

Modern Times Group is a growth company and generated record net sales of SEK
13.5 billion in 2011. MTG’s Class A and B shares are listed on Nasdaq OMX
Stockholm’s Large Cap index under the symbols ‘MTGA’ and ‘MTGB’.

The information in this announcement is that which Modern Times Group MTG AB is
required to disclose under the Securities Market Act and/or the Financial
Instruments Trading Act. It was released for publication at 08:00 CET on 30 July
2012.