DOW JONES NEWSWIRES
DirecTV Group Inc. (DTV) acquired an additional 18.9% stake in
SKY Brasil from Globo Comunicacao E Participacoes SA, or Globo, for
$604.8 million, part of a drive to expand in the U.S. and Latin
America.
DirecTV's purchase of 178.8 million shares from Globo and its
affiliates pushes its ownership stake to 93% from 74% and cuts
Globo's share to 7% from 26%.
Unlike regionally based cable providers, DirecTV has benefited
from higher activity in its Latin America business, though it soon
will face more competition in the area. Brazilian regulators
recently removed barriers to enter the pay-TV business and the
country's largest landline phone company Tele Norte Leste
Participacoes SA (TNLP4.BR, TNE), also known as Oi, has unveiled
plans to launch an Internet-based TV service.
DirecTV added 380,000 net new customers in the third quarter,
with most of the growth coming in Latin America. That segment
accounted for 15% of its revenue in the period. The middle class in
several of its regions, including Brazil, is growing, Bruce
Churchill, president of the company's Latin American arm, said
recently, with Brazil's market expected to double.
Globo had notified DirecTV in June that it intended to exercise
its rights under a 2004 exchange agreement among SKY Brasil's then
equity holders. The company has three more years to exchange the
remaining 7% stake in SKY Brazil.
Shares were down 10 cents at $39.55 in recent trading.
-By Tess Stynes, Dow Jones Newswires; 212-416-2481;
Tess.Stynes@dowjones.com