Scandinavian Broadcasting System’s (SBS) $615 million takeover of troubled Central European Media Enterprises (CME) hit the buffers last week. SBS’ COO Woody Knight said SBS had watched with increasing concern as CME had materially diminished in value. The agreement was called off because of CME’s problems with TV Nova in the Czech Republic.

TV Nova’s licence-holder, former CME partner Vladimir Zelezny, has transferred the licence away from CME and into another company. CME, backed by cosmetics heir Ron Lauder, has laid off over 200 staff at the station.

SBS will pay $8.25 million in compensation to CME for calling off the deal, but also gets CME’s Hungarian station TV3 as well as its programme library valued at $18 million. However the prospects for CME are not good. Despite having launched a flurry of writs against Zelezny and the Czech media authorities, the company’s share price has plummeted. Indeed, two years ago CME’s stock stood at $33 per share, when under the management of CEO Len Fertig. But management changes, first to Michel Delloye and more recently Fred Klinkhammer, and the troubles at TV Nova have seen the share price evaporate to just $1.50 a share.