Former journalist and alliteration enthusiast Robert Thomson understands the power of words better than most. So Rupert Murdoch’s top lieutenant knew exactly what he was doing when he announced during News Corp’s quarterly call with investors this morning that the company had fielded “third-party interest in a potential transaction” involving Foxtel.
The comment was the talk of the media sector and investment banking circles on Friday. It also piqued the interest of investors — News Corp shares gained 7.62%, hitting their highest levels since 2013 when Murdoch split his publishing and entertainment assets apart.
The move to hang a for sale sign above Foxtel raises all sorts of questions about the future of the legacy pay TV business, which once dominated Australian pay TV but now faces an onslaught of competition from a wide array of streaming services including Netflix, Disney, Amazon and Apple.
At the top of the list of those questions is: can Foxtel actually be sold? For their part, bankers not involved in the deal have their doubts. News Corp has been trying to offload the asset for the better part of a decade now. It has been making moves since at least 2017 to set Foxtel up for an IPO on the ASX and has progressed those plans to advanced stages at least twice, only to abandon them due to market conditions and uncertain investor demand.
