News Corp nears $2 bn Aus pay-TV deal
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Consolidated Media Holdings Ltd agreed to back a revised A$2 billion ($2.06 billion) takeover offer from Rupert Murdoch's News Corp , in a deal that would give News Corp a greater share of Australia's pay-TV market.
A successful takeover would also clear the way for billionaire James Packer, who holds a 50.1 per cent stake in Consolidated Media, to exit his last big media venture as he focuses on gambling.
The deal will double the stake of News Corp's Australian unit in dominant pay-TV operator Foxtel to 50 percent and give it 100 percent of content provider Fox Sports, boosting its pay-TV exposure at the same time as it cuts back print operations.
Consolidated Media (CMH) said its board backed the offer, in the absence of a higher bid.
The binding proposal from News Corp represented an implied multiple of 9.4 times forward earnings, as well as a premium of 15 percent to the average share price over the past three months.
In my view, this is a great outcome for CMH shareholders and for News and it reflects a fair price, Packer said in a statement.
A sale would see Packer all but exit what was once a media empire, built up over decades by his father Kerry Packer and grandfather Sir Frank Packer, apart from a 10 percent stake in television company Ten Network.
Packer, who has built stakes in casinos in Australia, London and Macau, owns casino group Crown Ltd which is hoping to build a second casino in Sydney.
NO HIGHER BID SEEN
News Corp's Australian unit News Ltd had previously offered A$3.50 per CMH share in an indicative proposal on June 20.
The new, binding proposal is A$3.45 per share plus a dividend of A$0.06, for a total of A$3.51 per share.
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