OREANDA-NEWS. February 27, 2010. MediaSaturn Holding (Media Markt), a German holding, is seeking to buy a controlling stake in M.video, reported the press-centre of OTKRITIE Financial Corporation.

View: If Media Markt purchases a controlling stake from the major shareholder, M.video minorities might get a fair buyout offer. At present, the free float is approximately 30%. Given the low consolidation in the industry and the company's steep discount to EM peers on the 2010 EV/EBITDA multiple (50%), the company is likely to be valued at a premium to its current stock price.

Valuation and Action: M.video trades on a 2010 EV/EBITDA of 7.7x. If the offer comes at a premium to the current multiples, we would recommend staying invested in the stock.