Mixed signals

15 August 2008 By John Foley Follow @johnsfoley

The buyout firm is paying a premium for a majority stake in Murdochowned digital TV firm NDS, but it s not getting much for its money. With scant leverage and partial control, this $3.7bn deal looks like an LBO only without the L or the B.

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Permira and News Corporation agreed to buy out NDS, a Nasdaqlisted payTV technology firm, in a deal valuing the company at $3.7bn. The transaction would see News Corp reduce its stake in NDS from 72% to 49%, with Permira taking the remaining 51% and public shareholders being bought out for cash.

News Corp, the media empire of Rupert Murdoch, already controlled NDS through its holding of supervoting Bclass shares. Following the deal with Permira, News Corp will hold 50% of the company's votes. In the last financial year, companies partly owned by News Corp accounted for 37% of NDS's revenues.

Following its acquisition of Dow Jones, Rupert Murdoch's News Corp is a minority investor in breakingviews. Dow Jones' Wall Street Journal also carries a daily breakingviews column.

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