Flextech ties up pay-TV deal
Wednesday 30 October 1996
In exchange for its shares, Pearson will get voting stock in Flextech representing equity of about 4.6 per cent of the company, although this could change depending on Flextech's share price when the deal is finalised.
It is still unclear how many votes will be attached to the voting stake. TCI is known to be seeking to avoid diluting its current holding, which gives it 51 per cent of the votes. Cox Communications is believed to have secured a similar deal.
The preliminary agreement opens the way for Flextech to complete its recently announced joint venture with the BBC to launch as many as eight pay-television channels on satellite and cable from next summer. A final agreement could be reached as early as November. It also gives Pearson a stake in a company many analysts expect will emerge as a "second force" in the supply of programming in the pounds 1bn market for pay-television.
Negotiations between Flextech and Pearson on the new pay-television channels were complicated by the need to conclude a complicated set of talks involving the BBC, Pearson and Cox Communications, which were aimed at consolidating Flextech's holdings in the two channels.
Once the UK Gold and Living consolidation is formally in place, BBC/Flextech can broadcast programmes from the extensive library of the BBC, the rights to which are currently held by UK Gold, the "golden oldie" nostalgia channel.
According to sources close to the talks, Pearson has won new service contracts from Flextech in exchange for its agreement to sell the UK Gold/Living stakes. Pearson Television handles the transmission services for UK Living, as part of its pounds 90m a year transmission business.
Under the provisionally agreed deal with Flextech, Pearson will now provide similar services for UK Gold, Bravo and Discovery, which is worth about pounds 2m annually.
As part of the deal, Pearson, which owns Thames Television and Grundy Worldwide, has also agreed to move some of its production activities to Flextech's studio in Maidstone.
Flextech and the BBC hope to complete their programming deal by the end of the year. The two briefed cable industry executives and media analysts Monday night on their plans for the new channels, in a presentation one analyst said was "slick and impressive." Flextech shares rose 21p to 611p.
The eight channels will include arts, sport, documentaries, current affairs and even a repeats channel.
Justin Bieber was one of the hardest hit
- 1 Nigel Farage: Me vs Russell Brand on Question Time – he's got the chest hair but where are his ideas?
- 2 Harry Potter fans can apply to the Hogwarts-inspired College of Wizardry
- 3 Jessica Chambers: 19-year-old woman 'doused with lighter fluid and burned alive' in the US
- 4 Russell Brand calls Nigel Farage 'poundshop Enoch Powell' in BBC Question Time debate
- 5 Orange Wednesdays are no more
Weather bomb in pictures: Storms cuts power for tens of thousands – and snow is on the way
Jessica Chambers: 19-year-old woman 'doused with lighter fluid and burned alive' in the US
Russell Brand calls Nigel Farage 'poundshop Enoch Powell' in BBC Question Time debate
Russell Brand was rendered speechless on Question Time by this man
Fury at Airbus after it hints the super-jumbo may be mothballed
Disgruntled RBS worker writes hilarious open letter to Russell Brand after anti-capitalist publicity stunt leaves him hungry
Shock poll shows voters believe Ukip is to the left of the Tories
Nigel Farage's approval rating hits 'record low' as popularity suffers in wake of Ukip sex scandal
Ukip candidate jokes about 'shooting peasants' in racist and homophobic rant
Nigel Farage defends Kerry Smith 'ch***y' comment: 'If you are going for a Chinese, what do you say you’re going for?'
Pakistan school attack live: Taliban kill at least 132 children in 'horrifying' massacre
iJobs Money & Business
Up to £70,000 per annum + benefits: Sheridan Maine: Are you a qualified accoun...
Up to £65,000 per annum + benefits: Sheridan Maine: Are you a qualified accoun...
£32000 - £35000 per annum + benefits: Ashdown Group: Marketing Services Manage...
£Neg. (DOE) + Excellent Benefits: Guru Careers: A Finance Account Manager with...