The board of Spanish media conglomerate Prisa has approved Telefonica’s €725m (US$1bn) offer for pay-TV operator Distribuidora de Television Digital, better known as Canal+, which it tabled earlier this week.
Telefonica is looking to add Prisa’s…
The board of Spanish media conglomerate Prisa has approved Telefonica’s €725m (US$1bn) offer for pay-TV operator Distribuidora de Television Digital, better known as Canal+, which it tabled earlier this week.
Telefonica is looking to add Prisa’s 56% stake to the 22% of the DTH broadcaster it already owns. The remaining 22% is held by Silvio Berlusconi’s Mediaset.
In a regulatory filing, Prisa said that it intends to close the deal within 30 calendar days. The sale will allow Prisa to further chip into its €3bn (US$4.2bn) debt pile – well above its market capitalisation of €580m (US$808m).
The transaction will require regulatory approval. Spain’s number three mobile operator Orange has already complained about the deal.
The French telco was reported to have urged antitrust and telecoms regulator CNMC to veto the takeover, or impose significant remedies, as Orange said the deal would give Telefonica an 80% market share of pay-TV content in Spain.
The acquisition would bolster Telefonica’s quad play offering in the highly-competitive Spanish market. Rival operator Vodafone has been boosted by the purchase of cableco Ono for €7.2bn (US$10bn), which will give it a fibre optic network that covers 13 of Spain’s 17 regions, passing 7.2 million homes. Meanwhile Orange was reported to be weighing a bid for fixed-line operator Jazztel.
Prisa was said to be looking for €1bn (US$1.4bn) for its shares in Canal+, but no one met that price by a 31 January deadline for binding offers. In March, reports suggested Prisa was looking for €800m (US$1.1bn).
Al Jazeera, Canal+ France, Liberty Global and News Corp were reported to be eyeing the stake.
In late February Prisa’s main shareholder reduced its stake in the conglomerate below 30%. This triggered a purchase option that allowed Telefonica or Mediaset to acquire Prisa’s stake in the broadcaster for an undisclosed fixed amount.
However, Telefonica declined to exercise the option, saying at the time it preferred to pursue a takeover outside of the arrangement. It has not said how it intends to finance its offer for Canal+.
