Murdoch talks Euro TV in Italy

NEWS CORP chief Rupert Murdoch yesterday discussed a deal which could lead to the creation of a pan-European pay-TV network in talks with executives from Mediaset SpA, Italy's biggest private broadcaster, says the chairman of Mediaset, Fedele Confalonieri.

In meetings in Milan, and at lunch at the country villa of Mediaset's controlling shareholder Silvio Berlusconi, Mr Murdoch studied the so-called "Traviata" plan for a bail-out of the ailing German media group of Leo Kirch, Mr Confalonieri said.

News Corp and Mediaset are widely expected to purchase around 20 per cent of the Kirch Group, which has seen cashflow problems worsen as it struggles to meet payment deadlines for rights to Hollywood productions and forthcoming World Cup soccer events which it bought for its loss-making DF1 digital network.

The Traviata deal would give Mr Murdoch his long-awaited foothold in Europe, denied him twice in the past three years by Mr Berlusconi, who turned down offers from News Corp - through British Sky Broadcasting - to purchase his 50.6 per cent stake in Mediaset.

It would also give Mr Berlusconi and Mr Murdoch a head start in Europe's fast-growing digital broadcasting market.

Mr Berlusconi, a former Italian prime minister, was not at the meetings or lunch, Mr Confalonieri said as he left the villa.

Mr Berlusconi's daughter Marina and son Piersilvio - respectively deputy chairman and board member of Mediaset - did participate. It was the younger Berlusconis who persuaded their father to throw out Mr Murdoch's 6,000bn lire (pounds 2bn) bid for control of Mediaset last spring.

Mr Confalonieri refused to divulge details of yesterday's talks, saying only that Mr Murdoch's was "a courtesy visit" and that no further meetings were scheduled for the near future. "But things move fast in this industry," he added.

Yesterday's talks came as the Media Partners company of former Berlusconi associate Rodolfo Hecht pushed ahead with its plans for a European football super league, to be broadcast on an as yet unspecified pay-TV network.

Until forming Media Partners, Hecht was Berlusconi's chief sporting rights negotiator.

The Kirch Group has reportedly been seeking partners for its DF1 venture since European Union competition authorities vetoed an alliance between DF1 and Germany's other pay-TV network Premiere in June.

Kirch and Mediaset each owns 25 percent of Spain's Telecinco, while Kirch has a 1.3 percent stake in Mediaset itself.

Asked to comment on yesterday's meetings, a Kirch Group spokesman in Munich would only say, rather cryptically: "We continue to have nothing to say."

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