NZ low on News Corp's to-do list: Sky TV boss

John Fellet

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New Zealand is probably not high on Rupert Murdoch's agenda right now, Sky Television chief executive John Fellet says.

With the imminent split of Mr Murdoch's News Corporation empire into publishing and entertainment arms, there has been speculation in Australasia about what subsidiary News Limited will do with its minority stake in New Zealand listed satellite TV company Sky.

The announcement earlier this week News Corp will raise its stake in German pay-TV company Sky Deutschland would have been more fuel to the fire.

Mr Fellet told NBR ONLINE he does not know what News Ltd will do and the company does not share its strategy with him.

"I suspect New Zealand's low on the totem pole of things they're worried about right now."

He says a pre-Christmas, fully-imputed special dividend of 32 cents per share was prompted by the possibility News might sell.

Because NBR Rich Listers the Todd family sold their 11.1% stake in November, Mr Fellet says the sale of another 20% meant Sky would not be able to issue imputation tax credits on further dividend payments during the year.

"I was just concerned how easy the Todds got their shares away and investment bankers said they could have got a lot more shares away if they had a lot of buyers in the market."

In today's print edition of The National Business Review, JBWere (NZ)'s head of advice Barry McLauchlan says Sky is a good earner, with a gross dividend yield of 15% last year, but he does not know if that is enough to tempt News to raise its stake or attempt a full takeover.

With the rise of online viewing overseas and Sky's saturation of the New Zealand market he wondered about the company's long-term prospects.

Sky (NZX: SKT), which is listed on the NZX50 index, has dropped 7.3% over the last year, and started today at $4.90. 

dwilliams@nbr.co.nz


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