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Liberty Global Buys Stake in U.K.’s ITV for $825 Million

Liberty Global Buys Stake in U.K.’s ITV for $825 Million

British Sky Broadcasting purportedly sought to unload its stake in ITV in advance of a potential merger of its European pay TV platforms.

Liberty Global Buys Stake in U.K.'s ITV for $825 Million

Liberty Global Buys Stake in U.K.’s ITV for $825 Million

John Malone’s international cable operator Liberty Global said Thursday that it has agreed to acquire a 6.4 % stake in U.K. broadcaster ITV from pay TV giant British Sky Broadcasting.

The price tag is approximately $825 million (GBP 481 million). Rupert Murdoch’s 21st Century Fox owns 39 percent of BSkyB, that will retain a minimal stake in ITV.

The company will purportedly finance the offer through a combination of existing liquidity, along with a loan. In Britain, there are no regulatory approvals required for “this level of investment,” according to the Liberty Global. Earlier this year, Liberty Global sold its content division, Chellomedia, to AMC Networks for about $1 billion.

“This is an opportunistic and attractive investment for all of us in our largest cable market,” Liberty Global CEO Mike Fries said. “ITV may be the leading commercial broadcaster in the U.K., and we’re excited to become shareholders.”

Liberty Global last year acquired Virgin Media, the biggest cable operator in Britain. It has been looking for content deals since selling its networks unit Chellomedia to AMC Networks for around $1 billion.

Liberty Global recently partnered with Discovery Communications to jointly acquire independent U.K. production company All3media for $930 million.

Analysts had previously suggested that BSkyB could sell its ITV stake to boost money for a possible deal that would combine BSkyB with Sky Italia and Sky Deutschland, Fox’s two other European pay TV platforms.

Liberty Global said hello would finance the ITV deal through a combination of a loan and existing liquidity. “With this degree of investment, no regulatory approvals are required” in great britan, it said.

The company also asserted it “does not intend to make a deal to acquire ITV” outright. But it still reserved the authority to announce a possible offer over the following six months.

BSkyB originally acquired a 17.9 percent stake in ITV in 2006. U.K. cable operator NTL, which become Virgin Media, at the time was also considered a possible suitor.

British regulators later forced BSkyB to reduce its stake in ITV to below 7.5 percent amid competition concerns. The company lost a legal battle against the decision and sold the majority of its stake in 2010 at a loss.

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