Sky TV sale of outside broadcast subsidiary cleared by Commerce Commission

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The Commerce Commission has cleared the way for Sky Network Television to sell its outside broadcast subsidiary (OSB) to NEP New Zealand.

Sky TV generic

The Commerce Commission said it was satisfied Sky TV’s sale of its outside broadcast subsidiary would not substantially weaken competition.
Photo: Supplied / Richard Parsonson

The deal was announced in August last year and would see NEP become Sky’s technical production partner for the broadcast of live sport in New Zealand for the next 10 years.

NEP would acquire OSB’s six broadcasting trucks, two warehouses and all ancillary equipment as part of the transaction.

The deal ran into trouble when the Commerce Commission raised competition concerns.

Commerce Commission chair Anna Rawlings said it was now satisfied the acquisition would not substantially weaken competition in any New Zealand market.

“After careful consideration, the Commission is satisfied that there is no realistic prospect that OSB would continue to provide outside broadcasting services if the proposed transaction did not proceed.

“Rather, we consider it would seek to outsource those services to a third party, most likely NEP” .

Sky chief executive Sophie Moloney said she was pleased the deal had been given the green light.

As part of the transaction, Sky would save $50m in capital investment which would have been required to upgrade OSB’s technology.

“Our new partnership with NEP, which includes a ten-year services agreement, ensures that Sky will continue to deliver world-class sport coverage to our customers.

“Working with NEP, we will be able to bring to New Zealand’s shores the best advancements in the outside broadcast technology world, without incurring those substantial costs ourselves.”

The terms of the transaction are confidential.

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