Adding to Murdoch’s collection of riches, to possibly take another stab at a Time Warner takeover, is another £5Billion ($8.3 billion) from BSkyB. The London-based pay TV company has pitched in to acquire its sister companies Sky Italia and majority share of Sky Deutschland, creating a newly formed Sky Europe.
The BSkyB takeover is broken down as such: BSkyB will pay £2.5 billion for Sky Italia and £2.9 billion for its stake in Sky Deutschland. 21st Century Fox would receive payments for the combined totals of the payouts and BSkyB would also transfer its 21% stake in the National Geographic Channel. The company would also offer Sky Deutschland’s minority shareholders a €6.8 ($9) per share (↑1.4%).
In total, BSkyB will have earned itself ~20 million customers and dominate Europe’s four biggest pay TV markets.
BSkyB’s CEO, Jeremy Darroch, had this to say about his acquiring its two sister companies, “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.”
James Murdoch, Rupert Murdoch’s potential successor as CEO for Fox, was BSkyB’s CEO at one time and mirrored Darroch’s sentiments in a statement made back in May of this year. He felt the company needed to resolve its European pay-TV strategy, and having three separate firms is not optimal.
Bottom line, Murdoch has his sights set on Time Warner and is looking for revenue to make that deal happen. In addition, the expectation is that the pay TV channels will be more profitable run as one company as well as potentially saving £200 million by the end of the second financial deal.