confirms talks with Fox over assets in Germany, Italy
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[May 12, 2014]
— British Sky Broadcasting
said on Monday it was in early talks with Rupert Murdoch's 21st
Century Fox over the possible acquisition of its pay-TV assets in
Germany and Italy, Sky Deutschland and Sky Italia.
"BSkyB believes at the right value, this combination would have the
potential to create a world-class multinational pay TV group," the
group said in a statement.
A deal would unite Murdoch's European satellite holdings in a single
group. Fox owns a 39 percent stake in BSkyB, a 55 percent stake in
Sky Deutschland and all of Sky Italia.
Bloomberg had reported on Friday that Fox was in talks for such a
deal, worth about 10 billion euros ($13.8 billion), that would turn
BSkyB into a European satellite-TV giant. It quoted people familiar
with the situation.
21st Century Fox said on Monday said the combination of the
Sky-branded European satellite platforms in Britain, Germany and
Italy had often been discussed internally, but it noted that no
agreement had ever been reached.
"Over the years we've had numerous internal discussions regarding
the organizational and ownership structure of the European
Sky-branded satellite platforms," the company said in a statement.
"From time to time these conversations have included BSkyB, however
no agreement between the parties has ever been reached."
Shares in Sky Deutschland were trading up 7 percent at 6.8 euros,
valuing the group at 5.97 billion euros ($8.21 billion). Shares in
BSkyB were trading down 2.3 percent at 896 pence at 3.20 a.m. EDT,
giving it a market capitalization of 13.6 billion pounds ($22.9
Rupert Murdoch tried to take full ownership of BSkyB in 2010, but
the bid was derailed by a phone hacking scandal involving his
British tabloid News of the World in 2011. The U.S. company later
split into two, with its media assets listed as 21st Century Fox and
its publishing activities remaining in News Corp.
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BSkyB said talks were still preliminary and no agreement has been
reached on terms, value or transaction structure. It said that there
was no certainty that a transaction would occur.
Barriers to a deal include the fact that fact that Sky Italia is yet
to renew the Serie A soccer rights in Italy, which is a key part of
its TV offering, analysts at Citi said.
Britain's Sunday Telegraph newspaper said the media watchdog Ofcom
was poised to obstruct any attempt by Murdoch to unite his
continental pay-TV businesses with BSkyB in a way that would give
him overall control of the British satellite broadcaster.
The newspaper quoted sources saying such a deal would be likely to
prompt opposition from the communications regulator, based on media
(Reporting by Maria Sheahan in Frankfurt and Paul Sandle in London;
Editing by Jonathan Gould and Jane Merriman)
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