EXCLUSIVE: Shakeup Looming At Foxtel, Delany Tipped To Get Top Job If ACCC Approves Merger
A major shakeup is looming at the $3Billion dollar Foxtel if the subscription TV Company gets approval to merge with Fox Sports.
According to News Corp insiders Patrick Delany the current head of Fox Sport will take control of Foxtel.
Earlier this year the Australian Competition and Consumer Commission launched a formal inquiry into the proposed merger between Foxtel and Fox Sports which will give News Corp a 65 per cent stake in Foxtel.
ChannelNews understands that the ACCC is looking at several conditional undertakings that the organisation will have to accept for the deal to go ahead.If approved and subject gto the conditions Delany is tipped to get the top job.
News Corp presently owns Fox Sports and 50 per cent of Foxtel with Telstra.
Peter Tonagh the current Chief Executive Officer of Foxtel is set to move back into a senior role in News Corp.
According to sources Delany has been vocal with Foxtel management over the decline in subscribers especially for the Fox Sports packages.
A former marketing director at Foxtel Delany is an experienced executive who several people in the industry believe can turn around Foxtel and is “the right person to head up” the float of Foxtel in the future.
Currently the ACCC is considering the impact of the merger on the acquisition of sports content, the supply of telecommunications services and the supply of broadband services on fixed and mobile lines.
The ACCC is scheduled to deliver a ruling on December 7.
Currently several investment banking groups are circling management at News Corp and Telstra looking for a role in the float of Foxtel which is tipped to go ahead in 2019.
The move will see Telstra reduce its stake in Foxtel to 35 per cent from about 50 per cent.
At this stage the two key contenders are Citi who has a relationship with News Corporation and UBS who does work for Telstra.
Another contender is Credit Suisse.
The problem that Delany will have to tackle if he gets the top job, is how to grow market share beyond 26 per cent as organisations such as Amazon Prime who are currently bidding for global sports deals move into the Australian market, at the same time Optus in partnership with Fetch TV is looking to grow their sports packages.
If the ACCC approve the Fox Sports merger, Foxtel will be a much larger and more profitable Company which the current owners are hoping will appeal to investors.
It will also place the new entity in a stronger position to compete for sports rights.
For News Corp a lot is at stake after Lachlan Murdoch failed to get control of the Ten Network.
The move to float Foxtel will be News Corp’s biggest strategic moves since the Murdoch family split the company in 2013 according to analysts.
Foxtel has 2.9 million subscribers and annual revenues north of $3 billion.