[September 26, 2011] FOXTEL to acquire Austar United Communications from Liberty Global Tweet Sep 26, 2011 (Datamonitor Financial Deals Tracker via COMTEX) -- Update on July 11, 2011: FOXTEL, a satellite and cellular phone subscription company, has entered into an agreement to acquire 100% stake in Austar United Communications Limited by a series of transactions including a scheme of arrangement. Both Austar and FOXTEL are based in Australia. Austar is a subscription television provider offering primarily digital satellite services. Liberty Global, Inc., a US-based a cable operator offering video, telephone, and broadband internet services, holds 54.2% stake in Austar. The proposed acquisition of Austar by FOXTEL will be accomplished through a series of transactions as follows: (i) First, all of the shares in Austar that Liberty Global does not already control will be acquired by a new, wholly-owned subsidiary of Liberty Global through an Austar scheme of arrangement. The scheme will require the approval of only Austar minority shareholders. If the scheme is approved, it is currently anticipated that a separate FOXTEL entity will lend the new Liberty Global subsidiary the AUD1.52 ($1.6) per share cash consideration that will be paid to Austar minority shareholders upon implementation of the scheme. As an alternative, Liberty Global may decide to substitute Liberty Global or another financing party as the lender.; (ii)Second, following implementation of the scheme and a restructure, FOXTEL entities will acquire Liberty Global's existing interest in Austar for AUD1.52 ($1.6) per Austar share. This second phase is expected to complete approximately six to eight weeks after the scheme is implemented. To the extent FOXTEL provides the funding for the scheme, FOXTEL has separately agreed with Liberty Global to keep those funding arrangements in place for a specified period after completion of the transaction, and in certain circumstances will be liable to Liberty Global for any breach of those undertakings. If Liberty Global arranges substitute funding it will also receive that amount. Although the transaction will be executed in two separate phases, Austar minority shareholders and Liberty Global will receive the same amount of consideration per Austar share, and no other consideration will be paid to any party for their interest in Austar. Update on May 25, 2011: FOXTEL has made an indicative, non-binding and conditional proposal to acquire 100% stake in Austar for a price of AUD1.52 ($1.6) in cash per share. The proposal values Austar at AUD 2,500 million ($2,636.55 million) (including net debt of AUD525 million ($553.68 million) at March 31, 2011), representing an enterprise value multiple of approximately 10 times Austar 's consolidated operating cash flow for the 12 months ended March 31, 2011. Announcement (May 17, 2011): FOXTEL has confirmed that it is still in discussions to acquire a 54% stake in Austar from Liberty Global. Update on March 2, 2011: According to Bloomberg, FOXTEL is in talks acquire a 54% stake in Austar from Liberty Global at a price of AUD1.49 ($1.52) per share. The transaction is valued at approximately AUD1,900 million ($1,933.12 million). Rumor (February 17, 2011): According to the Wall Street Journal, theaustralian.com reported that FOXTEL is planning to acquire Austar. UBS Investment Bank is acting as financial advisor and Allens Arthur Robinson is acting as legal advisor to FOXTEL. Allen & Overy LLP is acting as legal advisor to Liberty Global. Goldman Sachs is acting as financial advisor, while Freehills and Blake Dawson are acting as legal advisors to Austar. Deal Value (US$ Million) 2636.55 Deal Type Acquisition Sub-Category 100% Acquisition Deal Status Announced: 2011-05-17 Deal Participants Target (Company) Austar United Communications Limited Acquirer (Company) FOXTEL Vendor 1 (Company) Undisclosed Vendors Vendor 2 (Company) Liberty Global, Inc. Deal Rationale A merger of Foxtel and Austar would create a national platform with more than 2.3 million customers that generates more than $800million EBITDA. Savings could be achieved by combining management, sales, marketing and call centre functions. % Acquisition 54% [ Back To TMCnet.com's Homepage ]