The battle over Foxtel, the delivery of IP content is on, with James Packer forced to spend $25 million defending his interests from a hostile share buy by Seven Network boss Kerry Stokes, who wants a slice of Foxtel.
The battle over Foxtel, the delivery of IP content is on, with James Packer forced to spend $25 million defending his interests from a hostile share buy by Seven Network boss Kerry Stokes, who wants a slice of Foxtel.
Packer via his Company ConsMedia own 25% of Foxtel and are seen as the weakest link, out of the 2 other shareholders, Telstra who own 50% and News Ltd who own the other 25%.
A shareholder notice released this morning reveals said that Packer’s private family company Consolidated Press bought $14.4m worth of ConsMedia shares on Wednesday after Stokes’s Seven Network launched its attack on Packers Company.
Seven Network who are believed to be in control of 18% of ConsMedia, believe that if the Federal Government force Telstra, to divest itself of Foxtel, as part of the reshaping of communication in Australia that they will have a say in who buys what shares.
There was also a wave of speculation yesterday that Mr. Stokes may ultimately look to a full takeover of ConsMedia in an effort to get a foot in the door at his arch rival, Foxtel, and Cons Media’s 50 per cent interest in Premier Media Group, which operates the Fox Sports channels on the Foxtel platform.
He is already a shareholder in Sky News which is currently expanding their operations on the Foxtel Network.
Seven will be forced to declare the size of its stake today in ConsMedia.
According to the Australian newspaper RBS Equities media analyst Fraser McLeish said Mr. Stokes did not appear to be looking to any short-term control of ConsMedia. “It’s a long game,” he said. “He is there if anything happens to the ownership structure.”
Citi media analyst Digby Gilmour said that while Mr. Stokes was required to sit under the 20 per cent ownership threshold, he could “creep” over this level at 3 per cent every six months.
He said the purchase was most likely a strategic investment for Mr. Stokes. “We believe that at this stage, Seven may be simply assuring a seat at the table in any future corporate action involving ConsMedia, Foxtel and/or Fox Sports,” he said.
