News Corp. and Australian telecommunications giant Telstra have struck a deal to sell Australian media company Foxtel Group to sports streaming platform DAZN. Ticket price? A whopping 2.1 billion dollars!
Under the terms of the agreement, shareholder loans in the amount of $361 million currently outstanding and owed to News Corp. will be repaid in full in cash upon closing of the agreement. Foxtel's existing debt will be refinanced at closing and transferred to DAZN. News Corp. will retain a minority stake in DAZN of about 6%, as well as a seat on the board of directors. Nice shot!
Telstra Group Ltd. will also sell its minority stake in Foxtel, have shareholder loans of $80 million repaid and take a minority stake in DAZN of about 3%. We remind you that Foxtel Group is 65% owned by News Corp. and 35% by Telstra.
This deal will give “international exposure to Australian sport, while giving Australian fans greater access to sports programming from around the world,” News Corp. said in announcing the deal.
The deal “also allows News Corp. to further simplify its structure to increase long-term shareholder value and focus on key growth pillars,” the company said, adding: “The deal follows a strategic and financial review of Foxtel as part of News Corp.'s ongoing efforts to optimize its portfolio and simplify the company's structure.”
“This deal is a win for News Corp. shareholders, for DAZN and for sports fans in Australia and around the world,” said News Corp. CEO Robert Thomson. “Foxtel has transformed itself into a true digital and streaming leader in Australia, and we believe DAZN is the right ownership to take the company to the next level with its technology capabilities, global presence and captivating sports rights. This transaction also allows News Corp. to focus on Dow Jones' other growth pillars, Digital Real Estate and Book Publishing, while benefiting from the repayment of our shareholder loans and an improved credit profile.”
Foxtel will continue to be led by CEO Patrick Delany and his current team. Foxtel has 4.7 million subscribers and is involved in pay television, streaming, sports production and advertising.
“News Corp.'s ongoing support and guidance has enabled Foxtel to successfully reinvent itself into a dynamic, streaming-driven business with strong financial performance,” said Delany, adding: “DAZN's support will enhance our strategy, will give us access to their global reach and strengthen the infrastructure and technology to accelerate our transformation. Most importantly, we will continue to be a proudly Australian company, led by local management, committed to providing locally produced sports and entertainment content for our audiences.”
DAZN confirms it has 300 million viewers in 200 markets and streams over 90,000 live events every year. It plans to enter new markets and add more sports to its programming mix, which already includes European soccer, women's soccer, boxing and MMA, and the NFL internationally.
“Australians watch more sport than any other country in the world, making this deal an incredibly exciting opportunity for DAZN to enter a key market, marking another step in our long-term strategy to become the global home of sport” , said DAZN CEO Shay Segev. “Foxtel is a successful company that has undergone significant digital transformation in recent years, and we are confident that our global reach and relentless pursuit of innovation will continue to advance the company and ensure its long-term success. ”
The deal, which is expected to close in the second half of fiscal 2025, is subject to regulatory approvals and other customary closing conditions.
