Tuesday 21 October 2014

Cable group Liberty Global buys BSkyB's stake in ITV

* ITV shares up 9 pct on bid speculation
* Liberty says will not make bid for ITV
* BSkyB sells stake for 481 mln stg
* BSkyB in talks to buy into Germany, Italy

Kate Holton

Published 17/07/2014 | 12:30

UTV Ireland is set to launch in 2015
UTV Ireland is set to launch in 2015

US-based cable group Liberty Global has bought BSkyB's 6.4pc stake in ITV, boosting its shares on hopes of a wider bid.

Billionaire John Malone's Liberty, which bought cable operator Virgin Media as part of a European expansion last year, said it did not intend to make an offer for the rest of the broadcaster, but ITV shares still rose 9pc.

The sale, at a price of £481m may also indicate that BSkyB is looking to raise cash to push ahead with its own expansion plans after it opened talks this year to buy Rupert Murdoch's Sky Italia and Sky Deutschland.

The purchase is just the latest in a string of deals in the global media sector to buy content and follows ITV's drive to develop its production arm and generate revenue beyond its traditional, and volatile, advertising source.

"It is hard to see how this will not be looked at as anything other than Liberty planting a flag in the ground for a potential acquisition at some point," Liberum analyst Ian Whittaker said.

"ITV is now likely to be seen as a potential M&A story, especially given recent news flow in the media sector."

Just this year, Liberty teamed up with Discovery Communications to buy TV producer All3Media, Discovery took a controlling interest in European sports broadcaster Eurosport and Murdoch's 21st Century Fox has been seeking to buy Time Warner.

Cable operators have traditionally focused on providing broadband and television to households, meaning they were more likely to be aggregators and re-sellers of programming, but Liberty has owned content companies in the past.

Dubbed everything from the Cable Guy to Cable Cowboy, Malone made his fortune through a series of deals that transformed and ultimately consolidated the U.S. cable industry into one dominated by a few big players. Liberty Global is now also present in 12 European companies.

It called ITV officials on Wednesday evening to make them aware of the stake sale and to say it did not intend on launching a full bid.

UTV Media oversees operations of the ITV Network across Northern Ireland and provides ITV programmes to Ireland. UTV Ireland is set to launch in 2015.

Reuters

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