UPDATE: Australia's Regulator Delays Foxtel/ Austar Decision A Day
21 July 2011 - 7:06PM
Dow Jones News
Australia's competition regulator has delayed until Friday its
ruling on Foxtel's proposed 2.5 billion Australian dollar (US$2.7
billion) takeover of regional pay television company Austar United
Communications Ltd. (AUN.AU).
The Australian Competition and Consumer Commission's decision,
originally slated for Thursday, is now expected to be released
Friday morning, a spokesman for the regulator said. The spokesman
said the delay was due to administrative reasons.
Foxtel is 50% owned by Telstra Corp. (TLS.AU) and 25% each by
News Corp. (NWS) and Consolidated Media Holdings Ltd. (CMJ.AU). A
spokesman of News Corp.'s Australian unit declined to comment when
called. News Corp., owner of Dow Jones & Co., the publisher of
this newswire, is fighting to contain a phone hacking scandal that
has engulfed its tabloid newspaper assets in the U.K.
The scandal has prompted Australia's Greens Party and the
country's union of journalists to call for a review of media
ownership.
Austar's major shareholder, U.S. cable giant Liberty Global
Inc., (LBTYB) has agreed to the terms of the takeover, and Austar's
independent directors have also recommended minor shareholders
approve the deal. If approved by the regulator the deal would see
Foxtel become Australia's dominant pay television provider, with
estimated annual revenues of more than A$2.8 billion.
A spokesperson for Austar wasn't immediately able to comment. A
spokesperson for Foxtel declined to comment.
Ahead of the ruling, analysts are skeptical that a deal could be
blocked due to News Corp.'s specific problem.
Commonwealth Bank of Australia (CBA.AU) believes the regulator
is "more likely to approve the deal than not", but said in a note
the organization, of ACCC, could recommend that content be
regulated to ensure internet service providers using the federal
government's A$36 billion high speed internet national broadband
network have affordable access to content.
-By Ross Kelly, Dow Jones Newswires; 61-2-8272-4692;
Ross.Kelly@dowjones.com
--Gavin Lower in Melbourne contributed to this article.
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