After much speculation, media and gaming mogul James Packer has finally moved to cash in his $1 billion stake in Foxtel, in a move that could start a bidding war between News Limited and Telstra.
According to reports, investment bank UBS has been employed to handle the sale, which would see Packer sell off his 50.1% stake in Consolidated Media Holdings, which has a 25% stake in Foxtel and a 50% stake in Fox Sports Australia, formerly Premier Media Group.
The sale would aim to fuel Packer's plans to merge his Crown casino group, which owns Crown Melbourne and Burswood in Perth, with Echo group, which owns The Star in Sydney. The move would see the formation of a $10 billion gaming behemoth.
The sale would see Packer essentially remove himself from the media industry to focus on his gaming interests. In 2006, he sold off his stake in the Nine Network for $4.5 billion.
According to reports, Packer has said the most likely buyer is Rupert Murdoch's News Corp. This would see News Corp become 50% owner of Foxtel and 100% owner of Fox Sports Australia. Foxtel is currently 50% owned by Telstra and 25% owned by News Corp, while Fox Sports Australia is a joint venture between Consolidated Media and News Corp.
However, pundits have argued telco giant Telstra will also be interested. However, the Australian Competition and Consumer Commission has already said it would be concerned if Telstra was able to gain a 75% stake in Foxtel.
Kerry Stokes has also been signalled as a potential suitor through his Seven Group Holdings.
It has been speculated for some time Packer would sell his stake.
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