Reuters: Market News: UPDATE 1-Australia's Austar shareholders back $2 bln Foxtel deal

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UPDATE 1-Australia's Austar shareholders back $2 bln Foxtel deal Mar 30th 2012, 04:08 Fri Mar 30, 2012 12:08am EDT * Proxy votes indicate shareholders clear takeover by Foxtel * Competition watchdog yet to approve takeover * Austar shares gain 2.1 pct vs broader market up 0.4 pct MELBOURNE, March 30 (Reuters) - Shareholders in Australian pay-TV firm Austar United Communications voted on Friday to approve a $2 billion takeover by larger rival Foxtel, potentially reducing competition in a deal that still needs approval from regulators. Australia's competition watchdog is worried that the merger would kill pay-TV competition by merging the two main providers, Austar and Foxtel, which is owned by Telstra Corp, Rupert Murdoch's News Corp and James Packer's Consolidated Media Holdings. Proxy votes were clearly in favour of the deal, a filing to the stock exchange showed, eight months after the takeover was first proposed. Austar said 1,143 shareholders by number supported the takeover, with 32 against, well above the 50 percent threshold required. The total number of proxy votes in favour was 393.3 million, with 14.8 million against, well above the 75 percent threshold needed. FOXTEL'S PROPOSALS On Tuesday, the Australian Competition and Consumer Commission (ACCC) suspended its plan to rule on the bid this week, as it sought input on proposals that Foxtel argues would keep the sector open to new competitors. Austar has said it is hopeful that the ACCC will give its final decision before a court hearing on the merger due on April 13. Foxtel promised to not enter into any exclusive content agreements to buy internet TV rights, leaving the door open to more competition through online TV. Shares in Austar were trading up 2.1 percent after the proxy votes were released at A$1.45, still just shy of the offer price of A$1.52 per share. Earlier on Friday, Austar Chief Executive John Porter dismissed claims that News Corp's pay-TV operation had sabotaged its rivals in the 1990s, saying there was no sign of any conspiracy. Reports by the British Broadcasting Corporation and the Australian Financial Review newspaper this week said that News Corp's pay-TV smartcard security unit, NDS, had promoted piracy attacks on rivals, including in the United States. "In Australia, we've had over 150 prosecutions subsequent to improvements in the copyright laws," Porter, who has headed Austar since it was formed in 1995, told Australian radio. "I've never once heard the name of NDS or News Corp in those investigations or prosecutions," he said. Link this Share this Digg this Email Reprints

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