China Cablecom Announces Six Month Payment Extension for Binzhou Broadcasting
Renegotiated payment preserves cash liquidity and strengthens Company's financial position during on-going discussions of acquiring additional assets
SHANGHAI, Jan. 5 /PRNewswire-FirstCall/ -- China Cablecom Holdings, Ltd. ("China Cablecom" or the "Company") (Nasdaq: CABL) (Nasdaq: CABLW) (Nasdaq: CABLU), a joint-venture provider of cable television services in the People's Republic of China ("PRC"), announced today that it has entered into an amended framework agreement pursuant to which it has further extended its payment deadline to Binzhou Broadcasting until June 30, 2010.
Under the revised agreement, the Company is relieved from its obligation to pay outstanding cash payments of approximately $16.5 million prior to December 31, 2009 and has renewed the duration of contract with its Binzhou JV partners.
"The extension of our payment is a strategic move to effectively manage our resources," says Pu Yue, Chief Executive Officer of China Cablecom. "The Company underwent a successful restructuring in late 2009 and raised sizeable capital for the growth of our business. By prolonging our payment, we are taking a conservative approach to utilize our cash position and take advantage of our liquidity for other potential opportunities as we are in discussions to acquire additional cable asset operations. We believe that this agreement also demonstrates the confidence of our JV partners and their cooperation and interest in continuing a long systemic relationship with China Cablecom."
In 2007, China Cablecom entered into an asset purchase with Binzhou Broadcasting for cable operations covering the Shandong Province. To date, within the five cable subsidiaries of Binzhou, the Company has reported operational highlights which include a total paying subscriber count of 481,186. Digitalization efforts have begun to increase after the local price bureau approved the increased ARPU for digital subscription. As of the end of the third quarter of 2009, digital subscribers were 58,000 and broadband subscribers were 4,748.
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% economic interest in a cable network in Hubei province with paying subscribers exceeding 1,100,000. 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.
CONTACT: Debra Chen (917-499-8129)
Email: [email protected]
SOURCE China Cablecom Holdings, Ltd.
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