Murdoch's Italian foothold
MEDIA mogul Rupert Murdoch finally gained a foothold in the Italian pay-TV market yesterday, sealing a deal to buy 35pc of Italy's second digital television operator Stream from Telecom Italia.
Under the memorandum of understanding signed in Rome, Telecom will keep 35pc of the loss-making multimedia unit, selling a further 18pc to Italian media group Cecchi Gori and 12pc to a grouping of four top national soccer clubs. ``The accord was signed this morning. We are satisfied,'' Stream chairman Miro Allione told reporters.
News Corp hungry for lucrative rights to screen Italian soccer had wanted much more of Stream than the portion it eventually settled for, spooking an Italian government keenly aware of Murdoch's reputation for taking dominant market positions.
News Corp last year signed a preliminary accord to buy 80pc of Stream, but the deal fell through after Rome rushed through a decree capping at 60pc the amount of top-drawer Italian football one digital operator was allowed to show.
Sale of non-core assets such as Stream, currently 100pc owned by Telecom Italia, was a central plank of Telecom's original defence strategy against smaller rival Olivetti's $65bn hostile bid. Stream was to be sold by 2000.