Telstra Share Price Climbs Following Foxtel Stake Sale Announcement

2 min read | December 23, 2024 11:06 AM AEDT | By Team Kalkine Media

Telstra Share Price Climbs Following Foxtel Stake Sale Announcement — Image source: Shutterstock

Details of the Deal

News Corp revealed that shareholder loans of $578 million owed to it by Foxtel would be repaid in full upon the deal’s completion. Additionally, Foxtel’s existing debt will be refinanced and transferred to DAZN. News Corp will retain a minority stake of approximately 6% in DAZN Group and gain a seat on DAZN's Board of Directors.

Telstra confirmed its own divestment of a 35% stake in Foxtel as part of the transaction. The Australian telco giant will receive $128 million in cash as repayment of shareholder loans and will also hold a 3% equity stake in DAZN.

The deal is expected to close in the first half of 2025, pending regulatory approvals.

Telstra management emphasized that the transaction will not materially impact its FY25 guidance or the company's profit and loss for the current financial year.

Telstra believes DAZN’s acquisition will provide new opportunities for Foxtel to grow its digital-first sports and entertainment platform on a global scale.

The transaction will also allow News Corp to focus on its other growth areas, such as Dow Jones, digital real estate, and book publishing, while benefiting from improved credit standing and repayment of shareholder loans.

Market Reaction

While Telstra’s share price has remained largely flat in 2024, the positive sentiment surrounding this announcement saw the stock climb slightly on Monday morning. Investors appear encouraged by the strategic shift, which positions Telstra for long-term value creation while maintaining a minority stake in DAZN’s global operations.

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