News Says No Thanks To “Blank Cheque” For Foxtel
News Corp reportedly turned down a “blank cheque” offer from a US firm to invest in Foxtel in the middle of this year.
As reported in the Sydney Morning Herald today, industry sources revealed that News was approached by a US-based special purpose acquisition investment company (SPAC) to acquire a significant stake in the pay TV company in exchange for paying off a large chunk of its $2.1 billion debt; News Corp would have retained substantial holdings in Foxtel had the deal gone through.
Foxtel struggled this year due to the pandemic and resulting closures of pubs and clubs, with revenue dropping by more than $24 million AUD in the first quarter; this is despite a seven per cent increase in subscribers as of September 30.
The identity of the SPAC – a publicly listed company that allows retail investors to invest in unlisted companies – is unknown, but sources believe Liberty Media, whose chair James Malone is a friendly rival of Rupert Murdoch’s, may have been involved.
Foxtel currently has 298,000 paying subscribers for its Foxtel Now streaming service, and 644,000 for its sport-focused Kayo service. It received $17.5 million in fast-tracked taxpayer funds from the Australian government earlier this year.