(Adds Prisa comment, updates shares, adds background, Madrid
LONDON/MADRID, July 4 British pay-TV firm BSkyB
BSY.L is considering a bid of more than 2.5 billion euros ($4
billion)for Spanish pay-TV platform Digital+, the Financial
Times said on Friday.
The newspaper quoted people familiar with the situation as
saying there had been no decision to proceed, but that BSkyB's
strong cash flow could allow it to finance an acquisitions.
Prisa, which has media interests ranging from top-selling
newspaper El Pais, Latin American radio stations and publishing,
said interest in Digital+ from BSkyB's parent company News Corp
NWSa.N was well known.
"It's a fact that News Corporation are interested in taking
part in an auction or bidding contest in the event it is put up
for sale," a Prisa spokeswoman said, before adding: "We still
haven't taken a decision. It is a possibility (Prisa will sell
Prisa is studying the sale of some or all of its pay-TV
businesses in a wide-ranging review of the audio-visual arm to
cut debt that analysts estimate at 4-5 billion euros which
swelled after it acquired the remainder of subsidiary Sogecable.
On June 20, it said it had won a month's extension on a 4
billion euro bridging loan as it tries to refinance the debt.
BSkyB declined to comment on the FT's report.
Analysts were sceptical that a bid would materialise,
estimating that BSkyB is unlikely to take on the level of debt
needed to complete the acquisition.
"Sky bidding for Digital+ would be a negative. It doesn't
have sufficient debt capacity to afford it," Credit Suisse
analyst Simon Baker wrote in a research note.
BSkyB shares were 2.6 percent lower at 446.25 pence by 1212
GMT while shares in Spanish media group Prisa (PRS.MC), Digital
Plus's parent company, were up 2.4 percent at 6.72 euros.
According to the Financial Times, Spanish groups Telefonica
(TEF.MC) and ONO, France's Vivendi (VIV.PA) and France Telecom's
FTE.PA Orange unit were also likely to be interested in buying
(Reporting by Myles Neligan and Mark Potter in London and Ben
Harding in Madrid; Editing by Quentin Bryar, Paul Bolding)