Russia's ORT seeking pre-election loans
Channel's wide range is influential, costly
Cash-strapped ORT, which is 51% owned by the Russian state, is rumored to be seeking $80 million to continue operations in the period leading up to Russia's presidential elections next June.
Channel 1 received a $100 million loan from state-owned Vneshekonombank at the beginning of this year, allowing it to pay off debts which had the web on the verge of bankruptcy. In return for that credit, ORT pledged 13% of its stock to the bank, based on a valuation which put the venture's worth at $800 million.
ORT spokesman Grigory Simanovich said that there was no definite information on the proposed refinancing, though he suggested that preliminary talks were going on. "We knew that the $100 million credit would only be enough to pay ORT's debts, and we certainly hoped for extra credit," he said.
Wide reach, influential
Transmitting across 98% of Russia's vast landmass, ORT has been more vulnerable than its competitors to the ad downturn that has hit the territory since the August 1998 financial crash. Though its wide reach is expensive to maintain, it also makes channel the most influential in Russia's pre-election race.
ORT's leading private shareholder is power broker Boris Berezovsky, whose Logovaz group owns 11% of the channel while also de facto controlling the remaining 38% stake held by a banking consortium.
Berezovsky, who has teamed up with Rupert Murdoch's News Corp. on a number of media ventures in Russia, is one of the chief forces behind Russian president Boris Yeltsin's Kremlin political grouping.
