The technology, media and telecommunications industries are extremely hot right now, with the major players in the TMT sector recently involved in a variety of M&A activity. John Malone’s Liberty Global plc (NASDAQ:LBTYA) (NASDAQ:LBTYB) has recently joined the fray by purchasing BSkyB’s 6.4% stake in British commercial broadcaster ITV plc (LON:ITV) (OTCMKTS:ITVPF).
ITV has thoroughly remodeled itself under CEO Adam Crozier, now selling more programming globally and significantly less dependent on unpredictable advertising revenues (44% of 2013 revenues were from non-advertising sources).
The sale of BSkyB’s stake in ITV plc (LON:ITV) (OTCMKTS:ITVPF) closes James Murdoch’s controversial decision to purchase 17.9% of the then struggling firm so rival NTL would not be able to create a larger competitor. BSkyB was forced to divest all bit 7.5% of its ITV stake after investigations into the firm by UK regulatory authorities in 2006.
At this year's annual Robin Hood conference, which was held virtually, the founder of the world's largest hedge fund, Ray Dalio, talked about asset bubbles and how investors could detect as well as deal with bubbles in the marketplace. Q1 2021 hedge fund letters, conferences and more Dalio believes that by studying past market cycles Read More
Details on Liberty Global – ITV purchase
Liberty Global plc (NASDAQ:LBTYA) (NASDAQ:LBTYB) reportedly paid a price of 481 million pounds ($824 million) for the ITV stake. A number of analysts have commented that the deal could suggest that BSkyB is raising to move forward with its own expansion plans relating to Sky Italia and Sky Deutschland.
John Malone controls Liberty Media. A well known dealmaker, Malone’s been called everything from the Cable Guy to Cable Cowboy. He made his name and his fortune with a decade-plus-long series of deals that transformed and ultimately consolidated the U.S. cable industry. Liberty Global also operates in 12 European countries today.
Liberty Global to bid for ITV?
“It is hard to see how this will not be looked at as anything other than Liberty planting a flag in the ground for a potential acquisition at some point,” Liberum analyst Ian Whittaker said about today’s deal.
“Liberty’s Virgin Media Inc. (NASDAQ:VMED) (LON:VMED) did look to buy ITV nearly a decade ago and presumably the rationale for a deal then – access to content, help to support the Virgin brand and grow customers, financial engineering – still exists now.”
Earlier this year, Liberty Global plc (NASDAQ:LBTYA) (NASDAQ:LBTYB) partnered with Discovery Communications Inc. (NASDAQ:DISCA) ((NASDAQ:DISCB) to acquire TV producer All3Media, Discovery took a controlling interest in European sports broadcaster Eurosport, and the Wall Street Journal is reporting Murdoch’s Twenty-First Century Fox Inc (NASDAQ:FOXA) is also looking to buy Time Warner Inc (NYSE:TWX).
ITV plc (LON:ITV) (OTCMKTS:ITVPF) shares were up 6% at 195 pence as of 07:36 GMT.