News Corp’s pay TV and streaming company Foxtel – the broadcaster of NRL, AFL and cricket – has been sold to international sports streaming platform DAZN – a British company backed by a Russian-born billionaire and with links to Saudi Arabia’s Public Investment Fund.
DAZN’s majority shareholder is Access Industries, owned by Soviet-born Sir Len Blavatnik, who is a British and US citizen. The sale is worth $3.4 billion.
The news comes a day after DAZN made headlines and enraged users for streaming issues at the start of Sunday’s Tyson Fury vs Oleksandr Usyk fight.
DAZN will get access to broadcast rights for Australia’s leading sports competitions and faces a decision on how to integrate Kayo with its own platform.
The move could also affect the next rights deal for rugby union. Stan and Nine are currently in an exclusive window to strike a deal, but Rugby Australia might be tempted to hold off with DAZN in the wings.
There have been questions raised over DAZN’s relationship with Saudi Arabia and potential investment from its sovereign Public Investment Fund with reports that the PIF will invest US$1 billion ($A1.57bn) into DAZN.
DAZN has made it clear its ambition is to become the world’s biggest sports streaming service and its has mainly focussed on football and combat rights.
Foxtel has deals with AFL and cricket until 2031, while the NRL wants to secure a new deal from 2027.
Foxtel chief executive Patrick Delany said the company remained committed to Australia’s sports codes.
“News Corp’s unwavering support and guidance has seen Foxtel successfully reinvent itself into a dynamic, streaming-led business delivering strong financial performance,” Delany said.
“We are excited to embark on the next chapter with DAZN, a premier global sports streaming provider, as our new shareholder.
“DAZN’s backing will enhance our strategy needed, provide access to their global reach, and strengthen the infrastructure and technology to accelerate our transformation.
“Most importantly, we will continue to be a proudly Australian-based business, led by local management, committed to delivering locally-produced sports and entertainment content for our audiences.”
Under the deal, News Corp will receive $578 million in cash for repayment for outstanding loans to Foxtel Group, while Telstra will get $128 million.
The transaction values Foxtel Group at $3.4 billion, including debt.
Under its terms, News Corp will receive a six per cent minority interest in DAZN while Telstra, which owns a 35 per cent stake in Foxtel, will get a three per cent stake in the London-based sports streaming service backed by British-Ukranian billionaire Len Blavatnik.
“Australians watch more sport than any other country in the world, which makes this deal an incredibly exciting opportunity for DAZN to enter a key market, marking another step in our long-term strategy to become the global home of sport,” DAZN chief executive Shay Segev said.
Segev said DAZN was committed to supporting and investing in Foxtel’s TV and streaming services across sports and entertainment, using what he described as world-leading technology.
“We are also committed to using our global reach to export Australia’s most popular sports to new markets around the world, just as we have done with the NFL, and we will continue to promote women’s and under-represented sports,” he said.
DAZN holds the rights to broadcast the NFL to all markets outside the US and China.
It has been heavily promoting the American football league to its international audience, including via broadcasts in five different languages.
DAZN also holds the rights to a long list of sports from around the globe.
Foxtel Group said the transaction would provide more international sports for Foxtel and Kayo subscribers.
News Corp chief executive Robert Thomson called the agreement “a victory for News Corp shareholders, DAZN, and sports fans in Australia and around the world”.
“Foxtel has been transformed into a genuine digital and streaming leader in Australia,” he said.
“We believe DAZN is the right owner to take the business to the next level with their technological capabilities, global footprint and compelling sports rights.”
(With AAP)
