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Topic # 242216 16-Oct-2018 15:38
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The Sky AGM is due soon and there is speculation that a buyer is sniffing around. I read recently that NBC has been mooted as a possible buyer.  I am not sure how this would leave the NZ TV market. 





Mike
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  Reply # 2108942 16-Oct-2018 15:47
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Why would you spend real $$$ to basically buy goodwill,

 

The only asset Sky has is its subscriber base, and I'm guessing churn/exit is rising quite quickly...


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  Reply # 2108943 16-Oct-2018 15:47
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NBC's not new to the NZ market.  They had a stake holding in TV3 when they launched back in 89 hence the NBC News and other program themes used by them . 





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  Reply # 2108959 16-Oct-2018 16:22
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wellygary:

 

Why would you spend real $$$ to basically buy goodwill,

 

The only asset Sky has is its subscriber base, and I'm guessing churn/exit is rising quite quickly...

 

 

Great soothsayer - do tell us what churn was in the last half (and year), and was that an increased churn rate or decreased churn rate?

 

How many net subscribers left (how many churned away and how many joined to give you that net number)?  And how many years of that level of subscriber loss would be required to meet the carrying level of goodwill?  How many years of that level of subscriber loss before the subscriber base = zero.

 

Could you also describe the free cashflow generation, the potential level of debt that a buyer could comfortably gear the company with parental guarantees, and the discounted cashflow given your assumptions of the duration of the business and its terminal value.

 

Then if you could post the assumptions around the derivation of goodwill - and the key drivers for variance of those assumptions and the impact therein of of the carrying value of goodwill and how it differs to your assumptions on discounted cashflow.

 

 

 

Much appreciated.


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  Reply # 2108971 16-Oct-2018 16:37
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  Reply # 2108972 16-Oct-2018 16:37
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Herald says NBC Universal are the tyre-kicker at present...also possibly looking at Mediaworks.

 

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12143301

 

 

 

"NBC Universal's parent, Comcast, recently won a bidding war with Fox for Sky TV UK with a king-hit £30 billion bid on September 23."

 

That would bring the Sky's back to where they were a long time ago - vaguely joined, but separate...might mean better ability to bid for top-level content?

 

 

 

"after its stock market battering, which has seen its shares fall from $4.80 to a recent $2.13 as the Vodafone merger wobbled then fell apart under regulatory pressure, Sky's market cap has crashed to just $829 million - making the still-profitable firm a potentially attractive acquisition target."

 

 

 

So they still make profit - that's positive at least.

 

 

 

 





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  Reply # 2108973 16-Oct-2018 16:37
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I did some digging around and this is in the NZ Herald, yes I know it's not the best source but Chris Keall has been around for a long time. O' memories of those days past reading NZ PC World.

 

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12143301





Mike
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 Mac user, Windows curser, Chrome OS desired.

 

The great divide is the lies from both sides.

 

 




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  Reply # 2108974 16-Oct-2018 16:39
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snap @Handsomedan you win





Mike
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The views stated in my posts are my personal views and not that of any other organisation.

 

 Mac user, Windows curser, Chrome OS desired.

 

The great divide is the lies from both sides.

 

 


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  Reply # 2108976 16-Oct-2018 16:39
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MikeB4:

 

snap @Handsomedan you win

 

I think I got you by the merest of seconds...





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  Reply # 2108979 16-Oct-2018 16:43
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MikeB4:

 

The Sky AGM is due soon and there is speculation that a buyer is sniffing around. I read recently that NBC has been mooted as a possible buyer.  I am not sure how this would leave the NZ TV market. 

 

 

Better off.





Ding Ding Ding Ding Ding : Ice cream man , Ice cream man


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  Reply # 2108983 16-Oct-2018 16:48
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I guess anyone can buy it if they buy enough shares, and it is cheap enough to look attractive. I am guessing the weak NZ dollar makes some NZ companies look very attractive.




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  Reply # 2108994 16-Oct-2018 17:08
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Mspec:

 

MikeB4:

 

The Sky AGM is due soon and there is speculation that a buyer is sniffing around. I read recently that NBC has been mooted as a possible buyer.  I am not sure how this would leave the NZ TV market. 

 

 

Better off.

 

 

I hope so but I wont hold my breath.





Mike
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The views stated in my posts are my personal views and not that of any other organisation.

 

 Mac user, Windows curser, Chrome OS desired.

 

The great divide is the lies from both sides.

 

 


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  Reply # 2108998 16-Oct-2018 17:16
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MikeB4:

 

I did some digging around and this is in the NZ Herald, yes I know it's not the best source but Chris Keall has been around for a long time. O' memories of those days past reading NZ PC World.

 

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12143301

 

 

I was surprised that Keall left the NBR (which is in a growth phase) to join the Herald (which is in decline).  He regurgitated his blueprint for Sky in case the high brow readers at the Herald hadnt paid to read it at the NBR.  I'd love to see his blueprint for the Herald (or newspapers in general).  


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  Reply # 2109065 16-Oct-2018 19:18
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NBC would be a terrible suitor for Sky in my view. Take whatever is good about Sky and toss it. They would simply ride it into the ground. They would have a puppet as the local CEO and forget investment in any new platforms, forget mobile platform, SVOD etc. 

 

 


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  Reply # 2109068 16-Oct-2018 19:25
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It has value. Quite a bit of value. It still has a large subscriber base (it's the dominant pay TV provider), a substantial net profit, healthy free cash flow, a library of programming rights (esp sport) and pays dividends. That's worth paying for.

 

The question is how much is it worth. Particularly given that it's in decline, with competitive threats and not a lot of subscriber good will towards it, and hasn't really executed its strategy well over the last 3-4 years.

 

The bean counters can make assumptions about it's future market share and profitability, plus how much they think a new owner might have the resources and ability to turn things around, or at least slow the decline, and use this to derive a value. It's bread and butter for any decent financial advisory firm.

 

As long as they pay materially below this, they will expect to come out ahead.


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  Reply # 2109198 17-Oct-2018 06:32
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NBC Universal has just won the right to buy Sky UK, that being so, hopefully if they buy Sky NZ too, we'll have access to the technology that Sky UK is currently using and more importantly developing.

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