Liberty Global said late Wednesday that it has received an offer from Foxtel to purchase its 54.2% interest in Australian pay TV giant Austar.
Foxtel, which is jointly owned by Australian telecom giant Telstra, News Corp. and Consolidated Media Holdings, has been expected to make the bid for months. Liberty Global which is the largest cable operator in Europe with 18 million customer relationships in 14 countries, has said in the past it would be interested in divesting of the Australian operation.
The offer values Austar at about 10 times operating cash flow. Liberty said in a statement that assuming a deal was reached it would receive gross proceeds of $1.1 billion for its 688.5 million Austar shares.
In a statement, Austar said that its board of directors, including representatives from Liberty Global, believes that "the proposal is appropriate in the context of a change of control transaction."