Spain,United Kingdom : BSkyB to pay around $300M to buy UK Broadband Arm of TELEFONIA [TendersInfo (India)]
(TendersInfo (India) Via Acquire Media NewsEdge) British pay TV giant British Sky Broadcasting (BSkyB) has entered into an agreement with Telefonica in order to acquire the Spanish telecom leader s UK-based broadband and telephony business for up to $300 million (£200 million).
The broadband and telephony business of Telefonica has been purchased by News Corp., an arm of BSkyB.
Telefonica s U.K. operations include O2 and BE, together with its fixed-line business.
The new deal will make BSkyB the second-largest broadband provider in the UK.
Under the latest deal, BSkyB will acquire 560,100 broadband and fixed-line users of O2 Broadband and BE Broadband brands for a preliminary amount of £180 million ($270m). Moreover, Telefonica will receive an additional sum of £20 million ($30m) after transition of the subscribers.
The acquisition deal is likely to be completed by the end of April and is subject to regulatory clearance.
Just a couple of weeks ago, the UK cable operator Virgin Media was acquired by Liberty Global for $23.3 billion. At that time, Virgin Media was the second biggest ISP in the UK with 4.4 million customers.
The deal between BSkyB and Telefonica will be beneficial for the two companies in several ways.
BSkyB will get half-a-million users, who will join its Sky Broadband subscribers of 4.2 million, surpassing 4.4 million users of Virgin Media, facilitating BSkyB to become the second largest firm in the UK in terms of ISP customer numbers. Moreover, it will provide an opportunity to Rupert Murdoch s News Corp. to race again with its rival Liberty Global.
Regarding the benefits of Telefonica, the entity will be able to give more focus on its U.K. and European 4G networks. The Spanish group will maintain ownership of the cellular business of O2, with overall around 23 million customers, and will participate in the race with other players to activate LTE services across the UK.
Telecom giant British Telecom (BT) is the country's largest provider with over 6.5 million broadband subscribers.
The third rank will be held by Virgin Media now, followed by TalkTalk with more than 4 million users.
The Chairman of Liberty Global John Malone and Murdoch of News Corp. were tangled in a row in the media field earlier also. Both the companies fought over satellite television giver DirectTV amid 2004 and 2006, which led to the acquisition of a controlling stake from News Corp. The value of this cash-equity deal was about $11 billion.
(c) 2013 Euclid Infotech Pvt. Ltd. Provided by Syndigate.info an Albawaba.com company
[ Back To Technology News's Homepage ]