Gateway Broadcast Services, an unrestricted subsidiary of Gateway Telecommunications, has raised US $60 million (P360 million) to accelerate the roll out of its pan African pay-TV service, GTV.
GTV is Africa’s first widely accessible pay-TV service, providing a choice of high quality television programming at an affordable subscription price. The GTV service includes exclusive coverage of some of Africa’s most desirable programming, including the English Premier League and the FA Cup.
Gateway is experiencing a strong demand for the GTV service and having launched it in June 2007, the company has sold tens of thousands of decoders and GTV is now available in 12 countries across Africa. This further investment in GTV will allow Gateway to accelerate the roll out of the service, with a view to expanding its footprint to over 30 countries during 2008, while maintaining a fully funded business plan.
The US $60 million PIK loan agreement has been entered into with GoldenTree Asset Management, one of the world’s leading relative value investment funds, as the sole lender and follows on from the successful fund raising of US $40 million in May 2007.
“From a standing start 6 months ago, GTV has shown tremendous growth, selling tens of thousands of decoders across 12 countries,” said
Julian McIntyre, Managing Director of Gateway Broadcasting Services,
“We are delighted to be in a position to be able to capitalise on the continued demand for accessible pay-TV in Africa, with geographic expansion into 18 more countries, improved routes to market and an exciting content offering.”
The move is aimed at taking advantage of opportunities in Africa, which is the least penetrated pay-TV region in the world with less than 1 percent of television-owning households in sub-Saharan Africa currently subscribing to pay-TV services, compared to 15 percent in Eastern Europe, 36 percent in Western Europe and 93 percent in North America.
However, Africa is thought to have over 46 million TV sets and growing at well over 10 percent per annum, representing a large and rapidly growing market for subscription television which Gateway thinks will grow to over US $3 billion by 2015.
GTV carries both major international channels as well as a number of in-house channels, including “G Prime”, a general entertainment and movie channel, and “G Sports 1”, “G Sports 2” and “G Xtra” .The G Sports channels focus on live sporting events, including the major European football leagues.
GTV is already available in Kenya, Uganda, Tanzania, Botswana, Rwanda, Mauritius, Malawi, Zambia, Ghana, Namibia, Ethiopia and Sierra Leone and is currently proceeding with a phased roll-out across sub-Saharan Africa.