By Rhiannon Hoyle
News Corp and Australian telecom company Telstra have agreed to sell their jointly owned pay television company, Foxtel, to sports streaming service DAZN Group in a deal that values Foxtel at around US$2.1 billion.
News Corp said Monday that the sale of Foxtel, in which it holds a 65% stake, will allow the company to sharpen its focus on key growth areas--digital real estate services, book publishing and Dow Jones, the publisher of this newswire and The Wall Street Journal.
News Corp Chief Executive Robert Thomson said in August that News Corp was evaluating its options for Foxtel after receiving interest from a potential suitor.
The deal would allow News Corp to benefit from the repayment of shareholder loans and an improved credit profile, Thomson said Monday.
Under the agreement, which values Foxtel at 3.4 billion Australian dollars, equivalent to US$2.1 billion, A$578 million of shareholder loans owed to News Corp will be repaid in full, the company said. Following the transaction, News Corp will hold a roughly 6% stake in DAZN as well as one seat on its board of directors.
The deal is expected to be completed in the first half of 2025.
"We believe DAZN is the right owner to take the business to the next level with their technological capabilities, global footprint and compelling sports rights," Thomson said.
Telstra, which has a 35% stake in Foxtel, said the sale to DAZN is an opportunity for Foxtel to develop its sports and entertainment service within a global platform.
"Now is the right time for this change," Telstra Chief Executive Vicki Brady said.
Telstra will get A$128 million for the repayment of shareholder loans and will hold a 3% stake in DAZN. The deal isn't expected to have a material impact on Telstra's fiscal 2025 guidance, the company said.
Write to Rhiannon Hoyle at rhiannon.hoyle@wsj.com
(END) Dow Jones Newswires
December 22, 2024 19:10 ET (00:10 GMT)
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