Prisa halts Digital+'s sale

Spain's main media group Prisa has stopped the sale process for its digital-satellite platform Digital+, unable to command the sum it wants for the pay-TV operator.

The difference between what Prisa is asking for the pay-TV operator is substantial. Prisa wants a minimum of €2,600 million and the Telefónica-Vivendi joint-venture with which it is in talks is willing to pay only €1,900 million and no more than €2,000 million according to sources close to the negotiations.

Prisa is at a crossroads. The group's debts press it down too much. At the end of next March the company will have to account the first end of its debt for €1,900 million of a total €5,000 million.

If Prisa cannot sell out Digital+ it is likely to have to sell other activities, possibly national private in-the-clear channel Cuatro or Spain's most important radio station Cadena SER, among other options. In more than two months the company will have to get rid of some of its businesses in order to cope with its big debt.

In the meantime the company is trying to create value for Digital+, giving carriage to Spain's most important private channels such as Mediaset's Telecinco and Grupo Planeta's Antena 3.

Prisa has been looking to sell Digital+ since last May. But the operator's value has been decreasing as months go by. The possible arrival of pay-DTT to Spain and the loss of the soccer rights in favour of laSexta's producer Mediapro have left Digital+ in a bad fighting position.

Other audiovisual sources indicate that maybe before the end of March a foreign investor (Mexican Carlos Slim?) could turn up in Spain being interested by it.

Added to its Digital+ woes, Prisa's value on the Stock Exchange has dropped drastically over the last few months. The company lost 80% of its value last year.

Within the company a lot of staff hope the Government will help Prisa survive this situation because Prisa helped the socialists gain the government in the Felipe González former Prime Minister.

Nevertheless Prisa also hopes to count on the banking sector's support to cope with this situation.