News Corp Completes Telepiu Transaction

Following protracted negotiations, Rupert Murdoch’s News Corporation has agreed to buy Telepiů, the loss-making Italian pay-TV operator, from Vivendi Universal for E920 million (£580 million).

Speaking at a conference in New York yesterday, Murdoch said that Telepiů was “a world class property in an untapped market without cable competition.” News Corp will take an 80% stake in the company with Telecom Italia controlling the remaining 20%. The two partners already have 50-50 share in Telepiů’s main competitor, Stream and the plan is to merge the two cable companies to form Sky Italia.

The deal heralds a new phase of News Corp investment in the European cable sector. Murdoch was believed to be disillusioned with the market after sinking $1.7 billion into the doomed KirchPayTV operation. However, Vivendi’s well documented financial problems presented a fresh opportunity and he was able to force the asking price for Telepiů down from an initial E1.5 billion.

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