PRISA sells 21% Digital+ stake for 470 million euros

PRISA and Telefónica have today signed a deal which sees the Spanish telecom giant acquire  21% of Digital+, Sogecable's pay TV platform (100% owned by PRISA). The total value of the deal (at around 470 million euros) values Digital+ at 2.35 billion euros.

César Alierta, Chief Executive Officer and Chairman of Telefónica said that, "the agreement will enable Telefónica to maximize its position in a market with huge growth potential. This is a satellite platform with a proven track record in terms of competitiveness. With this agreement, the provision of converged products and services from Telefónica will allow us to give a greater and more comprehensive response to the requirements of the customer."

Prisa's executive chairman Juan Luis Cebrián described Telefónica as the best strategic partner possible for the company. "I'm convinced that Telefónica's contribution to audiovisual development in Spain, in collaboration with Digital+, will go a significant way towards establishing a model that the country needs."  Juan Luis Cebrián said that "the divestment in Digital+ was in line with a number of decisions taken by PRISA  to guarantee financial stability."

Both companies have drawn up a shareholders' agreement which lays out the management structure for Digital+ and a partnership framework covering all aspects of audiovisual development in Spain.

The deal will see 240 million euros exchange hands with the remaining the remaining 230 million euros corresponding to debt owed to Telefonica by Prisa, dating from 2003. The acquisition is dependent on regulatory approval.

Digital+ is Spain's leading pay TV platform, with almost 2 million subscribers. The company posted revenue of 982 million euros in the third quarter of 2009 and has a potential audience of 6.5 million viewers. It offers more than 150 news and entertainment channels and TV services through its HD iPlus digibox receiver. Movie premiers and exclusive sports events have made Digital+ Spain's most popular digital TV platform.