Telecom sells stake in Sky TV to INL

12.15pm

Telecom today accepted Independent Newspapers Ltd's (INL) cash and shares takeover offer for its 10 per cent stake in Sky Television.

Telecom told the New Zealand Exchange it would own 10 per cent of INL and receive about $156 million after selling its shareholding in Sky TV.

INL is offering $3.35 in cash for each Sky TV share, plus three INL shares for every 10 Sky TV shares.

INL executive chairman Ken Cowley said the offer had been sent to all Sky TV shareholders today.

It would close on December 5, he said in a statement.

Sky TV shareholders who accepted the offer would be sent cash have their entitlement to INL shares registered within three working days, Mr Cowley said.

If INL bought more than 90 per cent of Sky TV's shares it could compulsorily acquire the rest.

It would then "amalgamate the two companies and return surplus capital from the sale of INL's publishing business to shareholders", Mr Cowley said.

"We believe the takeover offer and the amalgamation plan are the logical next steps for both companies."

If INL did not achieve total ownership of Sky TV it would not buy outstanding shares at a price higher than the current offer.

"Regardless of the outcome... INL intends to distribute the maximum amount of surplus capital in a tax-efficient manner to INL shareholders, including those INL shareholders who acquire shares as a result of the offer.

INL would also apply for an Australian Stock Exchange listing.

After buying the Telecom shares, INL would own 78.2 per cent of Sky TV, Mr Cowley said.

By midday, INL shares had last traded at $4.60, Sky TV shares were unchanged at $4.90. and Telecom shares were up two cents at $4.94.

- NZPA