Turbulence in Sky deal

By Chris Barton

Ihug's deal with Sky Television is on shaky ground.

Director Tim Wood confirmed the deal, which had Sky taking a 30 per cent share of Ihug believed to be worth about $30 million, went non-exclusive on August 4 and had still not been signed.

"We're having some disagreements. It's still in negotiations," said Mr Wood.

Sky chief executive Nate Smith confirmed there was "a difference of opinion on some key issues," but said it was inappropriate to elaborate. Both parties had signed a heads of agreement.

"Getting the ship into dock is proving a little more difficult," said Mr Smith.

Meanwhile Ihug has announced its on-line finance company, Ihug Finance, will open for business on September 1.

Initially, the finance company will provide hire purchase and rental options for Ihug products such as its subsidised PCs, TV set-top boxes and satellite dish receivers at below-credit card interest rates.

It would later offer financial services, including mortgage broking.