Vodafone is merging its New Zealand unit with the country's biggest pay-TV firm, Sky Network Television, in a $2.4 billion deal that will enable it to offer customers packages of entertainment, broadband and mobile, according to a Reuters report.
Sky's shares jumped nearly 20 percent.The deal will possibly give Sky Network the chance to expand beyond its traditional satellite broadcast market, which has been shaken up by the arrival of Netflix and Apple's online content service.
Vodafone said the tie-up would enable it to offer Sky's sports and entertainment programming to its mobile and fixed-line subscribers who increasingly wanted to access more content and communications from a single provider.
Under the terms of the deal announced on Thursday, Sky will buy the mobile phone provider for NZ$3.4 billion ($2.4 billion) in total, including NZ$1.3 billion in cash, to be funded through new debt, and the rest in new Sky shares. Vodafone will, however, own 51 percent of the combined entity after the deal, which is subject to regulatory clearance, the firms said.
Mobile operators and cable and satellite pay-TV groups in Europe, the United States and elsewhere are scrambling to tie-up so they can offer "quad play" packages of mobile, fixed-line, broadband and TV service.