Is Murdoch’s $9B Deal a Money Move for Time Warner?

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July 25 (Bloomberg) -- Bloomberg’s Ed Lee discusses Twenty-First Century Fox’s agreement to sell some European pay-TV assets to BSkyB in a $9 billion deal that may open up funds for chairman Rupert Murdoch’s pursuit of Time Warner. He speaks on “In The Loop.”

Isn't he selling to himself?

Fox owns 39% of b-sky-b. it's a brilliant move.

Raise more cash, consolidate his assets.

It's something he has wanted to do for a while.

It is almost a stop gap measure to his original plan.

He wanted to buy out the rest of b-sky-b. the hacking scandal erected around the same time.

Because of the political fallout -- the hacking scandal erupted at the same time.

Because of the political fallout -- he winds up of not having the pressure to -- does this give him the benefit of raising the bid for time warner?

$7 billion after taxes?

He will net $7 billion after taxes.

The thing the company signaled in their press release is they are not saying they are using all of this or any of it to increase the bid for time warner.

They stressed we are going to continue the whole share buyback program that they have been doing.

They buyback on average about four middle -- $4 billion.

If the deal gets done, they are likely to sell cnn.

That is definitely on the table for them.

That could be another $4 billion, $5 billion, $6 billion.

Is that enough?

They are at $85 per share now.

This brings it up to $95. that makes it interesting.

He could leave her up -- could lever up another $4 billion or $5 billion.

Why not?

Is he going to have to sell something?

I don't think he needs to get rid of stuff to shore up his balance sheet in any kind of way.

The company is well managed.

It does have an investment grade -- they don't want to destroy that in any kind of way just to get time warner.

They are being disciplined about it.

There are a lot of extra things they haven't mentioned.

Like the fact they would have all this cash left over even with extra buybacks.

Bloomberg news' ed lee, thank you so much.

Coming up, homeaway ceo brian sharples joins me.

You are watching "in the loop," live on bloomberg television.


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