Murdoch reported to be moving to consolidate European pay-TV holdings
NEW YORK (Reuters) - Reports this weekend that Rupert Murdoch's 21st Century Fox wants to consolidate its pay-TV European holdings by combining the company's stake in British Sky Broadcasting Group Plc BSY.L with its Sky Deutschland (SKYDn.DE) and Sky Italia assets would fit with the company's long-held view the Sky's would be strong together.
Bloomberg reported on Friday that Fox was in talks for such a deal, worth about 10 billion euros ($13.76 billion), that would turn BSkyB into a European satellite-TV giant. It quoting people familiar with the situation.
Fox (FOXA.O) owns a 39 percent stake in BSkyB, a 55 percent stake in Sky Deutschland and all of Sky Italia.
The companies have been in talks for months and a deal could be announced this summer, although it could still fail to happen, the report said. (link.reuters.com/kyw29v)
BSkyB and Fox declined to comment when contacted by Reuters.
Such a tie up would make sense in that it would give the combined assets more firepower when trying to bid for sports rights or entertainment programming across Europe.
Murdoch-controlled Fox's stake in Sky Deutschland is valued at 3 billion euros, while Sky Italia is valued at about 5 billion euros, Bloomberg reported.
The Financial Times also reported on Saturday that Murdoch is eyeing a pan-European Sky combination. It quoted one person as cautioning that no deal talks were taking place between BSkyB and Fox and no transaction was imminent, but another who said Fox was keen to explore a pan-European combination.
In a conference call with investors on Wednesday, Fox Co-Chief Operating Officer James Murdoch acknowledged that Fox was thinking about joining the properties.
"We've made no secret of our belief over the years that we think the Sky's are strong together. But that said, currently our focus is on operating each of those business as best we can. Each of the marketplaces that we operate in are competitive and very dynamic."
Fox, which operates cable channels, broadcast TV and a movie studio, split from its publishing division now known as News Corp (NWSA.O) last year.
Before the split, News Corp tried to buy the rest of BSkyB but the deal was scotched after a phone hacking scandal roiled the British political establishment and forced News Corp to retreat.
Fox President and Chief Operating Officer Chase Carey said on the call Wednesday that the company doesn't have plans to revisit another bid for the rest of BSkyB anytime soon. ($1 = 0.7269 Euros)