The list of potential partners for the future pay-TV newco of Italian broadcaster Mediaset is growing, with interest now being expressed by France’s TF1.

Italian daily Milano Finanza reported that TF1, 43.7 per cent owned by Bouygues group, has joined the list of media groups that have already expressed interest, including France’s Canal+, Germany’s RTL, Al Jazeera from Qatar and Spanish Telefonica, as well as investment funds BlackRock, KKR and Permira. Interest from TF1 is seen as strategic, as the French broadcaster would be able to put one foot in two markets where it is currently not present – Italy and Spain.

Although the entry of a new investor would be well received by the market, analysts from Citigroup point out that there are many questions hanging over the business.

“Mediaset is unlikely to increase subscriber numbers to justify the investment for the purchase of TV rights,” Citigroup commented. At the same time, “the Premium offer in Italy is still deficient in other areas in order to compete with rivals.” For this reason, Citigroup claims it is unlikely that “companies would be willing to enter the Italian pay-TV market and pay a premium for a minority stake in a business so well integrated into the rest of the group and with financial limits on the purchase of rights.”

Last December, the boards of directors of Mediaset and Mediaset España authorised the evaluation of a project for the integration and development of the group’s pay-TV activities in a single stand-alone company. The operation foresees the contribution to a newco of 100 per cent of the activities of Mediaset Premium and the 22 per cent stake – along with all the related options and rights – held in the Spanish operator Digital Plus. The project is still in its initial stages and should be implemented by this summer.

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