Recently, News Corporation (NWSA) reached an accord with the MOBY Group (MOBY) to acquire a minority stake in the company in order to expand its footprint in the Middle East.
Headquartered in Dubai, MOBY is a media company which operates in Central Asia, Afghanistan and the Middle East.
As per the conformity, News Corporation will provide its 50% stake in Broadcast Middle East (BME), its Farsi TV joint venture with MOBY for a minority stake in MOBY. Further, the company will also supplement MOBY deal with its capital reserve, which will be required for future expansions.
Following the closure of the deal, BME will now turn into a wholly-owned subsidiary of MOBY. News Corporation and MOBY, through BME, have launched couple of thriving Farsi-language channels, including FARSI1 and Zemzemeh.
Further, News Corporation added that the merger of its Farsi joint venture into MOBY will facilitate the company to expand its media business in the region (Middle East), which is under penetrated and has millions of audiences.
In the region, News Corporation operates with Rotana Holding, one of the major TV networks and holds 14.53% stake in the company. Moreover, the company through BSkyB remains on track to launch the region’s first, free-to-air Arabic news channel, Sky News Arabia, with a 50-50 joint venture with Abu Dhabi Media Investment Corp. (ADMIC).
News Corporation’s significant international presence has helped it broaden its client base and product portfolio. Among others, the company competes with Time Warner Inc. (TWX).
Currently, we maintain a long-term ‘Neutral’ recommendation on the stock. Moreover, News Corporation holds a Zacks #3 Rank, which translates into a short-term ‘Hold’ rating.
NEWS CORP INC-A (NWSA): Free Stock Analysis Report
NEWS CORP INC-A (NWSA): Free Stock Analysis Report
TIME WARNER INC (TWX): Free Stock Analysis Report
