MILAN — Merger talks between News Corp.’s Italian digital platform Stream and Vivendi Universal’s Telepiu started up again this week — with Rupert Murdoch attempting to knock down Telepiu’s $1.5 billion pricetag.
But it could take another month to settle the deal for the two cash-strapped payboxes, according to Italy’s financial daily Il Sole 24 Ore.
News Corp. and Viv U signed a preliminary agreement in June that will see Stream consume Telepiu. However, Murdoch failed to drum up local financial support for a merged entity on a trip to Italy in July when he met the top execs of all major banks and industrial groups.
According to Il Sole 24 Ore, Murdoch has temporarily given up trying to find industrial partners and is focusing on convincing financial backers. U.S. bank Chase Manhattan is reportedly ready to back him.
Piracy headway as subs rise
In the meantime, Telepiu’s campaign against piracy is starting to show results, prexy Emanuel Gout said Monday. In July, subscriptions rose by 40%, compared with the same month last year, and in August the increase was 80%.
Despite this improvement, Italy’s pay TV market remains underdeveloped and too small for two national pay TV operators, both of them debt-ridden and not strong enough to compete one against the other.
If the merger is not finalized, many analysts believe that the weaker operator, Stream, will be forced to shutter.