BT Is in Talks With Amazon, Disney on Sports TV Stake
(Bloomberg) -- BT Group Plc is in talks to sell a stake or all of its sports-broadcast division, BT Sport, possibly to a U.S.-based media or tech giant, according to people familiar with the matter.
Potential bidders include Walt Disney Co., Amazon.com Inc. and the Len Blavatnik-backed sports streaming platform DAZN, said the people, who asked not to be identified because the deliberations are private. Lazard Ltd. is advising on the process, and it isn’t yet clear how much money a stake may fetch, the people said.
“Early discussions are being held with a number of select strategic partners, to explore ways to generate investment, strengthen our sports business, and help take it to the next stage in its growth,” BT confirmed in a statement Thursday. They may or may not lead to an outcome, it said. Shares rose as much as 3% to 164.6 pence in early London trading to their highest price in 14 months.
The London-based telecom giant launched its sports broadcasting service in 2013 under previous Chief Executive Officer Gavin Patterson, after springing an expensive surprise attack against the U.K.’s best-known sports broadcaster, Sky, by bidding for Premier League soccer rights the previous year. The move continues to divide opinion, with some calling for the company to focus on its traditional role of telecommunications infrastructure.
Disney, Amazon and DAZN declined to comment.
The division “carries zero value” in the sum-of-the-parts equity valuation from analysts at Jefferies led by Jerry Dellis, he said in a note to clients. The move would signal confidence in the carrier’s core broadband service, he added.
The talks come as the economics of sports have been upended by the coronavirus, with many stadiums emptied, games canceled and advertising pulled. Earlier this month, some of Europe’s biggest soccer clubs made a failed attempt to start a breakaway Super League, and the Premier League is said to have proposed skipping the pending triennial rights broadcast auction, an idea under review by U.K. government officials.
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“Should BT get the opportunity to make a profitable exit from a business they entered in 2012 that has absorbed 9 billion pounds ($12.6 billion) of rights costs, they should go for it,” said media analyst Claire Enders, founder of Enders Analysis. “It is a structurally loss-making situation, given the current wholesaling arrangements.”
The discussions were first reported by the Daily Telegraph newspaper.
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