News Corp agrees to Foxtel sale to DAZN Group in A$3.4bn deal

In a move set to reshape Australia‘s sports streaming industry, News Corporation (Nasdaq: NWS, NWSA; ASX: NWS, NWSLV) has reached a definitive agreement to sell Foxtel Group to DAZN Group Limited for an enterprise value of A$3.4 billion. This landmark transaction, expected to close in the second half of Fiscal 2025, reflects a strategic decision by News Corp to simplify its portfolio and focus on key growth areas, while providing DAZN with unprecedented access to Australia’s sports-hungry market.

What Does the Sale Mean for Foxtel?

Foxtel, Australia’s leading subscription television and streaming provider with 4.7 million subscribers, has undergone a remarkable digital transformation under News Corp’s ownership. Over the past seven years, it pivoted from a traditional pay-TV operator to a digital-first, streaming-focused business offering premium sports and entertainment content.

The company’s businesses include Fox Sports, renowned for its live sports broadcasts and expert commentary, and streaming platforms such as Kayo Sports and BINGE. This deal enables Foxtel to further expand its global footprint by leveraging DAZN’s international reach and advanced streaming technology.

Foxtel CEO Patrick Delany expressed optimism about the transaction, emphasizing DAZN’s ability to strengthen Foxtel’s technological capabilities while maintaining its local focus. Delany reaffirmed that Foxtel would remain committed to delivering locally-produced sports and entertainment content, ensuring it remains integral to Australia’s media landscape.

How Does DAZN Plan to Integrate Foxtel?

DAZN, a global sports streaming giant operating in over 200 markets, is recognized for its extensive portfolio, including European football leagues, the NFL, Formula 1, and the FIFA Club World Cup. The company’s CEO, Shay Segev, highlighted the strategic value of entering Australia, citing the nation’s unparalleled passion for sports.

Segev stated that the integration of Foxtel would enhance DAZN’s market presence while enabling the export of Australian sports to a global audience. DAZN aims to invest in Foxtel’s existing streaming services, optimize its technological infrastructure, and promote underrepresented sports, including women’s competitions.

News Corp’s Strategic Focus Post-Transaction

The sale of Foxtel marks a pivotal moment for News Corp as it prioritizes its core growth segments: Dow Jones, Digital Real Estate, and Book Publishing. News Corp CEO Robert Thomson described the deal as a victory for shareholders, citing repayment of A$578 million in shareholder loans and an improved credit profile as key benefits.

This transaction also simplifies News Corp’s portfolio by divesting a major asset while retaining a 6% equity stake in DAZN and a seat on its board. Thomson noted that DAZN’s global reach and advanced technology make it the ideal partner to drive Foxtel’s next phase of growth.

What’s the Financial Impact of the Deal?

The A$3.4 billion enterprise valuation reflects Foxtel’s strong financial performance, representing over seven times its projected Fiscal 2024 EBITDA. Telstra Group Ltd, which holds a 35% stake in Foxtel, will also divest its share, receiving repayment of A$128 million in shareholder loans and a 3% stake in DAZN.

News Corp plans to classify Foxtel as discontinued operations beginning in the second quarter of Fiscal 2025, further streamlining its financial reporting.

A New Era for Australian Sports Streaming

This deal has far-reaching implications for Australian sports fans, who will gain access to a broader range of international content through DAZN’s global network. The partnership also underscores the growing importance of digital transformation in the media industry, as traditional providers like Foxtel evolve to meet changing consumer demands.

DAZN’s commitment to innovation and its focus on enhancing user experience aligns with Foxtel’s trajectory as a leader in digital streaming. Together, the two companies are poised to redefine the way sports and entertainment are consumed in Australia and beyond.

Expert Insights on Market Impact

Industry analysts view the transaction as a mutually beneficial agreement. News Corp’s ability to monetize its investment in Foxtel while retaining a foothold in the streaming industry positions the company for long-term growth. Simultaneously, DAZN’s acquisition of a well-established Australian brand strengthens its global portfolio and opens doors to new opportunities in a lucrative market.