News Corp to Divest Foxtel in $2.1 Billion Deal with DAZN
Deal News | Dec 23, 2024 | Zawya
In a strategic move, News Corp has agreed to sell its Australian cable TV unit, Foxtel, to the UK-based sports streaming service DAZN for A$3.4 billion ($2.1 billion), including debt. This transaction marks a significant shift for the Murdoch-controlled media empire as it looks to reduce its involvement in a television market disrupted by the rise of streaming platforms. As part of this agreement, News Corp will secure a 6% stake and a board seat within DAZN, enhancing its position in the global streaming arena. Foxtel has faced declining profits due to the shift of subscribers to cheaper platforms, despite efforts to diversify through its own streaming offerings like Kayo. The sale reflects News Corp's strategic refocusing on its primary activities, such as digital real estate, book publishing, and its Dow Jones business. Additionally, Australian telecom company Telstra will sell its 35% Foxtel stake to DAZN, receiving cash and DAZN equity in return. The deal, expected to close by mid-2025, awaits regulatory approval from Australia's Foreign Investment Review Board due to DAZN's overseas ownership.
Sectors
- Media and Entertainment
- Telecommunications
- Sports Broadcasting
Geography
- Australia – The transaction involves Australian entities, such as Foxtel, and the market implications for local content broadcasting.
- United Kingdom – DAZN, headquartered in London, is the acquiring entity, influencing the UK media industry.
- United States – News Corp, a major media conglomerate, has significant business interests in the US.
Industry
- Media and Entertainment – The article discusses News Corp's sale of its television unit, Foxtel, highlighting the media landscape's shift towards streaming platforms.
- Telecommunications – Telstra's sale of its Foxtel stake to DAZN aligns this transaction with the telecommunications sector.
- Sports Broadcasting – DAZN, a sports streaming platform, acquiring Foxtel involves a significant play in sports broadcasting, providing access to major sports leagues.
Financials
- $2.1 billion – The purchase price for Foxtel, including debt, agreed upon by DAZN.
- A$578 million – The value of shareholder loans that will be repaid as part of the deal.
- A$128 million – Cash Telstra will receive for its 35% stake in Foxtel from DAZN.
Participants
| Name | Role | Type | Description |
|---|---|---|---|
| News Corp | Selling Company | Company | A major media corporation controlling Foxtel, looking to divest in favor of focusing on other operations. |
| Foxtel | Target Company | Company | An Australian cable TV unit of News Corp that has faced declining profits owing to a shift to streaming. |
| DAZN | Bidding Company | Company | A global sports streaming platform acquiring Foxtel to expand its presence in the Australian market. |
| Telstra | Other Company | Company | An Australian telecommunications company selling its Foxtel shares to DAZN. |
| Len Blavatnik | Investor | Person | A Ukrainian-born billionaire and backer of DAZN, with investments in the media and entertainment sector. |
| Robert Thomson | Executive | Person | Chief Executive of News Corp, overseeing the strategic divestment of Foxtel. |
| Foreign Investment Review Board | Regulatory Body | Government | An Australian government entity reviewing the transaction due to DAZN's overseas ownership. |