Murdoch creates ‘Sky Europe’ pay TV giant

July 25, 2014 1:58 pm
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The new project, named "Sky Europe" by observers, is being seen as a bid by media mogul Murdoch to strengthen his European television operations/FILE
The new project, named “Sky Europe” by observers, is being seen as a bid by media mogul Murdoch to strengthen his European television operations/FILE
LONDON, July 25 – Rupert Murdoch’s media empire 21st Century Fox has struck a mega deal with British satellite television group BSkyB to create a pan-European pay-TV giant, the two companies announced on Friday.

BSkyB, 39-percent owned by 21st Century Fox, said it had agreed to buy Fox’s 100-percent stake in Sky Italia and its 57.4-percent interest in Sky Deutschland.

The new project, named “Sky Europe” by observers, is being seen as a bid by media mogul Murdoch to strengthen his European television operations as the telecommunications sector enters the market to screen live football matches featuring some the world’s biggest clubs.

Analysts said the deal would give 21st Century Fox an opportunity also to make a renewed bid for rival Time Warner.

BSkyB said it planned to acquire also the rest of Sky Deutschland from the German group’s minority shareholders, creating a pan-European TV giant in deals that could cost the British group up to £7.0 billion ($11.9 billion, 8.8 billion euros).

“The enlarged company will be a world-class multinational pay TV provider that serves 20 million customers and brings together the leading pay TV businesses in three of Europe’s four biggest markets,” BSkyB said in the statement.

James Murdoch, son of Rupert and the co-chief operating officer at 21st Century Fox, said “a combination of the European Skys would create enormous benefits for the combined business and for our shareholders”.

As part of the tie-up, BSkyB said it would transfer its minority stake in National Geographic Channel to 21st Century Fox at a value of £382 million.

“By creating the new Sky, we will be able to use our collective strengths and expertise to serve customers better, grow faster and enhance returns,” BSkyB chief executive Jeremy Darroch said in Friday’s statement.

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