Member Article

BSkyB pays £5 billion to take over Rupert Murdoch's European TV companies

Broadcaster BSkyB has acquired Rupert Murdoch’s German and Italian TV companies for £4.9 billion.

Along with the announcement that effectively creates a Sky Europe, the firms annual results were reported showing that pre-tax profits fell slightly from £1.26 billion to £1.2 billion, although revenues rose by 7%.

BSkyB aims to create a multinational pay TV business with acquisition of Sky Italia and 57.4% stake in Sky Deutschland from 21st Century Fox.

The total consideration for the acquisition of Sky Italia is £2.45 billion with approximately £2.07 billion to be paid in cash and the balance to be satisfied through the transfer of BSkyB’s 21% stake in National Geographic Channel International to 21st Century Fox at a value of £382 million.

The acquisition of 21st Century Fox’s shareholding in Sky Deutschland is for a consideration of £2.9 billion in cash, valuing Sky Deutschland at €6.75 per share. The transactions are subject to regulatory and independent shareholder approval.

Jeremy Darroch, BSkyB’s chief executive, said: “This transaction will create a world-class, multinational pay TV business with enhanced headroom for growth and immediate benefits of scale.

“The three Sky businesses are leaders in their home markets and will be even stronger together. 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.”

Nick Ferguson, chairman of BSkyB, said: “The Independent Directors of BSkyB unanimously believe the strategic rationale for a combination with Sky Italia and Sky Deutschland is compelling.

“The agreed valuation represents an attractive financial opportunity that will deliver growth and value creation for all shareholders.”

This was posted in Bdaily's Members' News section by Clare Burnett .