Sky TV in trading halt on Murdoch sale news
Sky Television has gone into a two-day trading halt after confirming global media company News Corporation will sell its 43.6 per cent stake in the New Zealand pay-television network.
Sky has issued a statement to the NZX this morning confirming Rupert Murdoch's global media company would divest "to a broad range of institutional and retail investors".
News Corp's president and chief operating officer Chase Carey said Sky had been "an outstanding investment for News Corporation".
"We and Sky have always enjoyed an excellent, arms-length working relationship and we expect this to continue unaffected by the sale," Carey said in a statement.
"In particular, we do not anticipate any change to current arrangements regarding access to content and collaboration on technology."
News confirmed it had appointed Craigs Investment Partners and Deutsche Bank to handle the sale, which began on Sunday night media reports say.
According to the Australian Financial Review, Sky TV's stake would sell at a price of $4.80, giving News Corp's shares a value of $815 million.
The price was a 7.2 per cent discount to Friday's $5.17 a share closing price, the AFR reported.
Sky said regional director of News Limited Michael Miller would resign from the board of Sky.
In January Sky Television's chief executive John Fellet told Fairfax Media there was a heightened risk that News could sell its stake at short notice.
The global media group has been reorganising its portfolio and splitting its business into separate businesses for television and film entertainment as distinct from its publishing assets.
News Corp but had recently increased ownership of Australian pay-television firm Consolidated Media Holdings, including 100 per cent of Fox Sports Australia and half of Foxtel. It has done similar deals with ESPN Star Sports in Asia and Fox Pan American Sport.
Fellet said he issued a special dividend before Christmas so that tax imputations would not become worthless in the event of a major shareholder sale, such as that being considered by News Corp.
In January Fellet said that although he did not have any information about News Corporation's plans, Todd Communications' sale of its 11 per cent holding last November showed how easily it could be done.
"All of a sudden I started thinking about News Corp and that if Todd got their shares away [so easily] then I could not prevent News Corp from wanting to sell out," he said.
Trading is expected to resume no later than Wednesday March 6.
Nasdaq-listed News Corporation had total assets as of December 31 of approximately US$63 billion and total annual revenues of about US$34b.