SHANGHAI, June 24 /PRNewswire-FirstCall/ -- China Cablecom Holdings, Ltd. ("China Cablecom" or the "Company") (Nasdaq: CABL), a joint-venture provider of cable television services in the People's Republic of China, today announced an initiative sponsored by the Shandong Party Committee to consolidate its provincial cable assets, a decree backed by the government and State Administration of Radio, Film and Television (SARFT). Under the review of this consolidation, all municipal cable operators including Binzhou Broadcasting have been instructed to maintain the current organization structure and suspend financing activities on assets until further notification from the government. As a result China Cablecom has been granted a temporary deferment of its obligations to deliver cash payments of approximately $16.5 million to the Binzhou joint venture partners.
China Cablecom originally acquired operating rights of the Binzhou Broadcasting network in Binzhou, Shandong Province on September 2007. Through a series of payment extensions, the deadline on the Company's outstanding payments was extended most recently until June 30, 2010. Following this announcement, China Cablecom has received an open-end deferment, while maintaining the current status of its equity position with joint venture partners at Binzhou. Further updates will be provided upon the receipt of government notifications regarding Shandong's execution plan for provincial cable consolidation.
"We believe the shift in government policy is an opportunity for China to establish the proper infrastructure to create uniformity and help accelerate its cable digitization deployment," says Pu Yue, Chief Executive Officer of China Cablecom. "We are well-positioned to be beneficiaries of these initiatives and are excited about the value this is creating for our shareholders."
Based on this recent government decree in support of the formation of "one consolidated broadcasting networking within one province," the Shandong government intends to create an integrated provincial network of cable assets to accelerate the nationwide deployment of digitization and allow a platform of high-quality network upgrades and development of value-added services.
About China Cablecom
China Cablecom is a joint-venture provider of cable television services in the People's Republic of China, operating in partnership with a local state-owned enterprise ("SOE") authorized by the PRC government to control the distribution of cable TV services through the deployment of analog and digital cable services. China Cablecom has consummated the acquisition of a 55 percent economic interest in a cable network in Hubei province with paying subscribers exceeding 1,200,000. The Company originally acquired operating rights of the Binzhou Broadcasting network in Binzhou, Shandong Province in September 2007 by entering into a series of asset purchase and services agreements with a company organized by SOEs, owned directly or indirectly by local branches of State Administration of Radio, Film and Television in five different municipalities to serve as a holding company of the relevant businesses. China Cablecom now operates 28 cable networks with over 1.67 million paying subscribers. China Cablecom's strategy is to replicate the acquisitions by operating partnership models in other municipalities and provinces in the PRC and then introducing operating efficiencies and increasing service offerings in the networks in which it operates.
Safe Harbor Statement
The matters discussed in this press release contain "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements contained in this presentation and in the Company's other written and oral reports are based on current Company expectations and are subject to numerous risks, uncertainties and assumptions, Any forward-looking statements are not guarantees of future performance and actual results of operations, financial condition and liquidity.. The forward-looking statements herein speak only as of the date stated herein and might not occur or the actual results may differ materially in light of these risks, uncertainties, and assumptions. The Company undertakes no obligation and disclaims any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. You should carefully consider these factors, as well as the additional risk factors outlined in the filings that the Company makes with the U.S. Securities and Exchange Commission, including the Annual Report on Form 20-F filed on July 15, 2009.
China Cablecom Holdings, Ltd.
SOURCE China Cablecom Holdings, Ltd.