Government backer buys Ukraine's top media group

By bne IntelliNews February 4, 2013

bne -

Amidst claims of pressure from Kyiv, fallen former first deputy Prime Minister Valeriy Khoroshkovsky announced in a February 1 statement that he has sold Ukraine's largest and most influential media outlet, Inter Media Group, to Dmitry Firtash - one of the government's main backers.

In a statement released by the press service of Inter TV Channel, Khoroshkovsky - who left the government in December following a high-profile spat over the reappointment of Prime Minister Mykola Azarov - said he has sold 100% of Inter Media to Firtash's GDF Media. The statement said the company was valued at $2.5bn, but unnamed sources reportedly claimed that the deal actually went through at half that figure.

"Thus, control over Inter, NTN, K1, Mega, Enter-Film, K2, Pixel and MTV goes over to GDF Media Limited, after an agreement is received from the Anti-monopoly committee," Inter's statement says. A Firtash spokeswoman, also confirmed the deal, but offered few details, reports Interfax.

The deal hands control of Ukraine's most popular TV channels to a prominent figure in the powerful business groups said to stand behind the administration of President Viktor Yanukovcyh. Firtash, whose business empire is based on gas and chemicals, is considered one of two key backers, alongside the richest man in the former Soviet Union, Rinat Akhmetov.

It appears little coincidence that the move comes in the wake of Khoroshkovsky's fall. The former head of the SBU (heir to the communist-era KGB) was regularly accused of using state apparatus during his time at the head of the finance and economy ministries to scupper independent media in recent years, while Inter TV was noted for its strong pro-government stance.

However, the editorial line of Ukraine's most popular TV channel has been changing since the autumn, according to analysts, and the company has introduced an independent supervisory council, including members of the opposition.

That has not gone unnoticed by the government, according to the Kyiv Post, which cites "several" unnamed sources who report that both Inter and Khoroshkovskiy have been harassed by the tax authorities and other state bodies.

Khoroshkovky pulls just short of confirming that conjecture in his statement. "Under the current circumstances," the former deputy PM says, "I'm unable to ensure the development of the group, and these circumstances were my principal motivation for the sale."

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