TimesonLine
February 14, 2007
Telefónica is set to make a €3 billion loss when it sells off the TV company that it bought in the dot-com boom
Telefónica, the Spanish phone giant, could lose as much as 60 per cent on its original investment in Endemol, the television production company behind Big Brother, when it goes ahead with the sale of the division.
Analysts are valuing Endemol at between €2 billion (£1.3 billion) and €2.2 billion, compared with the €5.5 billion that Telefónica paid for the company in 2000, at the height of the dot-com boom.
Since the acquisition, Telefónica floated off part of Endemol on the Amsterdam stock exchange, leaving it with a 77.7 per cent stake in the business.
Speculation that Telefónica would sell off the group heightened after Endemol secured shareholder approval today to buy out its French unit for €450 million.
Endemol France has remained separate from the rest of the company because of a long-running dispute over managers' payouts.
A Telefónica spokeswoman declined to comment on speculation, but said that the company had determined that Endemol, which also produces Channel 4's Deal or No Deal, was a non-core asset and was content to take its time in selling off the group.
Endemol declined to comment.
