Mogul takes all of STAR
RUPERT MURDOCH'S News Corporation has snapped up the 36.4 per cent of STAR TV it did not already own, paying Hutchison Whampoa and Genza Investments about US$299 million (HK$2.3 billion).
Genza - wholly owned by Richard Li Tzar-kai, the son of tycoon Li Ka-shing - and Hutchison said the deal was scheduled for completion on July 26.
STAR TV said News Corp was also taking over shareholder loans made by Genza and Hutchison to STAR TV, adding another US$46 million to the price.
News Corp first bought into STAR TV in July 1993, paying US$525 million for 63.6 per cent, half in cash and half in shares.
'This transaction is a continuation of the July 1993 transaction,' said STAR TV spokesman Doug-las Gautier. 'It enables STAR to exploit all the natural synergies that are part of the News Corp group,' he added.
These include access to the corporation's Fox network in the United States and BSkyB, its satellite broadcaster in Britain.
Arnie Tucker, a spokesman for Richard Li's Pacific Century Group, said the group was happy with the sale price.
He said Pacific Century felt its stake in STAR TV was under utilised. It offered no liquidity and had paid no dividend since it was set up.
Hutchvision Hong Kong, which is licensed to operate the uplink services for STAR TV, is still 52 per cent owned by Hutchison and the Li family.
STAR TV held the other 48 per cent, and a government spokesman said the responsibility for complying with the terms of the licence would remain with the Li family and Hutchison.
Analysts said the sellers had done well out of the deal. One estimated that Hutchison could make between HK$350 million and HK$450 million in one-off profits.
Hutchison had also done well out of the 1993 sale, receiving five times what it was believed to have invested in STAR TV, he added.
Analysts said they were not surprised to see News Corp pay what seemed like top dollar for a regional satellite broadcaster.
'The prices at which media and telecom deals are transacted often seem to defy conventional wisdom,' said one.
STAR TV reaches an estimated 220 million people in 53 countries across Asia, India and the Middle East.