Tvw Polish Tv Case Analysis
Telewizja Wisla Case
Questions to answer
TVW was originally founded by Szczerba and his wife Balinska with their financial adviser Claire Hurley. The founding idea of TVW stemmed from a growing media viewership and a rebounding Polish economy. Prior to the formation of TVW, the media market was dominated by government owned Public Television Poland (TVP). In 1993, the government enacted legislation which enabled the commercialization of the television and radio station markets. This was the opening for TVW in securing its stake in the newly independent media arena. However, in order to establish itself as a valid player in this market, TVW was required to secure a broadcasting license from the newly formed TV and Radio Council of Poland.
After the successful acquisition of the broadcasting license, seed money was required for Szczerba and Hurley to make their TVW vision come to fruition. In 1993, the founders were able to secure initial funding from both Realbud and Efekt in the amount of $4mm. Contingent upon receiving the regional license to broadcast in southern Poland, TVW was required to raise $2mm of equity capital by Dec 1994, an additional $2mm by June 1995 and to start broadcasting by December 1995. In addition to these capital requirements, the funding secured by TVW could not exceed 33% foreign voting control and no less than 51% original owner ownership with the Council having first right of approval for the foreign investors.
In addition to the $4mm of secured capital, TVW also took out a loan with the local Polish banks in the amount of $2mm which was to be repaid in 1996. TVW currently faces a liquidity crisis in which they currently are unable to meet their debt obligations without securing additional equity funding. The current outside investors are unwilling to provide the additional capital necessary for TVW to repay its loan. TVW needs to determine the best option in order to strategically grow its business while not falling
Questions to answer
TVW was originally founded by Szczerba and his wife Balinska with their financial adviser Claire Hurley. The founding idea of TVW stemmed from a growing media viewership and a rebounding Polish economy. Prior to the formation of TVW, the media market was dominated by government owned Public Television Poland (TVP). In 1993, the government enacted legislation which enabled the commercialization of the television and radio station markets. This was the opening for TVW in securing its stake in the newly independent media arena. However, in order to establish itself as a valid player in this market, TVW was required to secure a broadcasting license from the newly formed TV and Radio Council of Poland.
After the successful acquisition of the broadcasting license, seed money was required for Szczerba and Hurley to make their TVW vision come to fruition. In 1993, the founders were able to secure initial funding from both Realbud and Efekt in the amount of $4mm. Contingent upon receiving the regional license to broadcast in southern Poland, TVW was required to raise $2mm of equity capital by Dec 1994, an additional $2mm by June 1995 and to start broadcasting by December 1995. In addition to these capital requirements, the funding secured by TVW could not exceed 33% foreign voting control and no less than 51% original owner ownership with the Council having first right of approval for the foreign investors.
In addition to the $4mm of secured capital, TVW also took out a loan with the local Polish banks in the amount of $2mm which was to be repaid in 1996. TVW currently faces a liquidity crisis in which they currently are unable to meet their debt obligations without securing additional equity funding. The current outside investors are unwilling to provide the additional capital necessary for TVW to repay its loan. TVW needs to determine the best option in order to strategically grow its business while not falling