News Corp Agrees to Sell Foxtel Group for A$3.4 Billion

In a significant transaction, News Corp has reached an agreement to sell Foxtel Group to DAZN Group Limited for an enterprise value of A$3.4 billion, with the deal expected to close in the second half of fiscal 2025, subject to regulatory approvals.

Date: 23-12-2024

AI Rating: 6

The report outlines an agreement between News Corp and DAZN Group Limited, indicating a significant strategic move. The sale of the Foxtel Group, valued at A$3.4 billion, could greatly impact News Corp's financial position, affecting investor sentiment.

News Corp will receive cash repayment of A$578 million in shareholder loans at closing, which enhances its liquidity position. The full cash repayment of loans suggests improved cash flow, which is a positive indicator for investors.

The refinancing of Foxtel's current debt might result in reduced financial pressure, although details on the new debt terms are not provided. The fact that News Corp retains a 6% minority equity interest in DAZN and a board seat indicates ongoing engagement and potential future upside from this relationship.

Telstra Group Ltd is also involved in the transaction, divesting its 35% shareholding in Foxtel to DAZN while managing its own shareholder loans. However, Telstra's announcement that this won't materially impact its fiscal year 2025 guidance or financial performance diminishes potential concerns for its investors.

Overall, the sale reflects a strategy to streamline assets and possibly focus more on core business areas, which could be viewed positively by investors looking for clearer strategic direction.

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