Granada Sells Stake In BSkyB

Granada yesterday sold its 6.5% stake in BSkyB, its main rival in the digital television battle. Granada sold its chunk of the group directly to BT Alex Brown, the investment bank, for £429 million.

BT Alex Brown are understood to have bought Granada’s BskyB shares for 400p each, and sold them on for 404p to a wide range of investors. BskyB’s shares are currently at 435p, and Granada’s are 760p.

BSkyB launched its digital broadcasting service on 1 October (see Newsline). Granada has a 50% share, along with Carlton, in ONdigital, which is in direct competition with the Sky service. This made its part ownership in Sky something of a conflict of interest.

ONdigital is due to launch its digital service on 15 November (see Newsline).

Chief executive at Granada, Charles Allen, commented on the move:”BSkyB has been an excellent investment for Granada. But we concluded that, as a minority shareholder, and with a competing position in digital technology, the BSkyB stake is no longer a strategic hold. We have therefore decided to take advantage of BSkyB’s 23% outperformance of the FT-SE 100 Index since the beginning of July.”

Granada: 0171 261 3949 BSkyB: 0171 705 3200