Telefonica sells Big Brother TV group Endemol for $2.6 billion
Monday, May 14th, 2007

Spanish telecommunications group Telefonica has announced the sale of 75 percent of its stake in Endemol, which invented the Big Brother television programme, to a consortium led by Italys Mediaset for 2.6 billion euros (US$3.6 billion). The operation valued Endemol at 25 euros per share, Telefonica said in a statement, adding that it would book a capital gain of 1.4 billion euros.

The consortium includes Mediasets Spanish media subsidiary Gestevision Telecinco, investment bank Goldman Sachs and Dutch investment company Cyrte which is headed by John de Mol, who co-founded Endemol. Mediaset is controlled by former Italian prime minister Silvio Berlusconis holding company Fininvest.

Telefonica bought Endemol in March 2000 for 4.8 billion euros but the firms new board which took over later that year ruled it was a non-strategic asset as the company would focus on broadcasting rather producing audovisual content.

De Mol established Endemol with fellow Dutch producer Joop van den Ende in 1994. The company shot to fame with its Big Brother concept. The show has become popular with viewers in many countries. Among its other hit television show concepts is Extreme Makeover and Deal or No Deal.

Telefonica said it had agreed to sell the consortium 99.7 percent of Endemol Investment Holding, which indirectly controls its stake of 75 percent in Endemol. The consortium has agreed to make and unconditional bid for the remaining 25 percent of Endemol for a price of at least 25 euros per share as soon as possible following the close of this deal, it said in a statement.

(Source: AFP)