French media conglomerate Vivendi is looking at a possible acquisition of pay-TV group Sky, as one of several options to expand the reach of its own TV group Canal Plus, three people familiar with the matter told Reuters.
Vivendi has turned its attention to Sky after reviewing smaller pay-TV targets in Turkey and other fast-growing markets in Europe, Reuters reports; however, with a market value of £17.6 billion, Sky could cost Vivendi as much as £28 billion including debt.
According to the sources, deliberations are at an early stage and Vivendi has yet to decide on whether or not to go ahead with an offer.
“Ultimately what determines a deal is Vincent Bollore [Vivendi’s chairman and largest shareholder],” one of the sources said, however spokesmen for Vivendi, Sky and Bollore declined to comment.
The prospects for a sale of Sky improved last year when Britain’s largest pay-TV company BSkyB bought nearly all of Sky Deutschland and all of Sky Italia, to become Sky Plc, combining the entirety of Rupert Murdoch’s European TV interests in a single business.
The deal, which was designed to give Sky access to faster growing territories where pay-TV is not yet as popular or profitable as Britain, has also made Murdoch’s pay-TV assets more “sellable”, with several bankers seeing the move as the prelude to a possible sale.
Sky operates in Britain, Ireland, Germany, Austria and Italy, and has around 20 million subscribers.
Source: Reuters
