Murdoch & Messier (not a bill-topping comedy act as some might think) but a meeting of multimillionaire minds on the holy grail of converting their respective Italian black hole pay-TV operations into a profitable single business.
The two moguls, Rupert and Jean-Marie, shook hands on a mano-a-mano deal struck Wednesday that will see Vivendi Universal acquiring Stream, News Corporation’s lossmaking Italian pay-TV business and merging it with its own unit Telepiu. Says Messier: “There is an agreement at our level, which means I will definitely be able to go away on holiday on Friday.”
Messier needs his holiday, having been busy these last seven days. The latest deal follows hard on the heels of his purchase of a 10% stake in EchoStar [WAMN: 17-Dec-01] and the acquisition of USA Networks [WAMN: 14-Dec-01]. “I am a workaholic, not a dealaholic,” he said. “When I see a weakness, I move fast to address it.”
The Italian merger will end the bitter competition between the two pay-TV rivals over sports and film rights, enabling the melded operation to move into the black before 2003, Messier claims. As a separate entity, Telepiu would not have broken even before the end of 2004. In 2000 Stream shed some E400m ($361m) and Telepiu E220m.
The wedding is not likely to be blessed by Italian antitrust officials who believe it would effectively shut the door on new entrants to the nation’s pay-TV market. Messier, however, is no cock-eyed optimist and believes he can persuade the authorities otherwise, employing the curious argument that Murdoch could always re-enter the market as a competitor.
Meantime, the French tycoon killed speculation that he might move on cash-strapped German media operator Kirch Gruppe. “We’re not a candidate for a single piece of Kirch,” Messier said abruptly.
News source: Financial Times