The European Commission has conditionally approved the acquisition of Telepiù by News International paving the way for the formation of Sky Italia.
The decision marks the end of a five-month investigation which sought to determine whether the purchase of the Vivendi-owned operator would result in a monopolistic market (see
EC To Investigate Telepiu Takeover). Rupert Murdoch is now free to merge Telepiù with rival pay-TV company Stream to create Italy’s largest satellite broadcaster. Telecom Italia, which shared ownership of Stream with News International, will take a 20% stake in the new company.
The acquisition came at a price as Murdoch has been forced to make a number of concessions (see Murdoch Makes Concessions On Telepi) and has waived exclusive rights for content for non-satellite transmission. As a result, cable, terrestrial and internet broadcasters will be able to bid for movies and live sporting events.
However, this compromise appealed to Competition commissioner Mario Monti who commented: “I am satisfied that the commission, after an in-depth investigation and intensive negotiations with the parties, has established the right conditions for the pay-TV market in Italy to remain open and to evolve in a competitive way on a lasting basis to the advantage of consumers.”
The move also comes as a relief to Vivendi Universal which will earn £580 million from the deal. The indebted media giant yesterday announced that it had arranged a £450 million securitisation transaction based on future video and television revenues in the US from part of Universal’s film library.
