MILAN — The merger between Italy’s rival cash-strapped pay TV operators, Vivendi Universal’s Telepiu and News Corp.’s Stream, has been locked down according to Telepiu prexy Emmanuel Gout.
“Some technical and legal aspects are still to be finalized, but the story is written and will have a positive impact on the market and consumers,” Gout said Monday in Rome.
The news comes just four weeks after Vivendi U. and Rupert Murdoch’s News Corp. announced they were giving up the destructive subscriber war that has seen Telepiu accumulate losses estimated at $238 million in 2000 while Stream’s hit $360 million.
Italian telco giant Telecom Italia has a 50% stake in Stream, which it will sell to Murdoch.
According to Gout, the new, single Italian pay TV entity, which will keep the Telepiu name, will be “two-thirds controlled by Telepiu and one-third by Stream because this reflects current market share.”
However, both sides are still worried about presenting the deal to avoid EU anti-trust laws. Gout believes the new corporate structure will be finalized before the summer, with another three or four months before Brussels gives the go ahead.
The pay TV companies’ losses are also blamed on a devastating battle for Italian soccer rights, for which they have been paying $350 million a year.
According to industry sources, Vivendi and News Corp. are trying to renegotiate the super-expensive soccer club contracts before the merger.