LONDON (CNNfn) - Spain's Telefónica disclosed a groundbreaking 5.5 billion euro ($5.3 billion) takeover of Dutch entertainment firm Endemol Friday, the first European takeover that directly connects a national telecom carrier with the media industry.|
Telefónica's all-stock offer is worth 158 euros per Endemol share, a 27 percent premium over the Dutch firm's closing price Thursday, and a 50 percent premium to Endemol's average price of the past two weeks.
Endemol is involved principally in creating television programming and creating new formats, and has a library of 400 television show formats. The Dutch firm produces popular reality soap "Big Brother" and owns the Continental European rights to the worldwide smash "Who Wants To Be a Millionaire?"
Telefónica, Spain's dominant telecom operator, is a formerly state-owned monopoly that has become one of Europe's premier telephone companies and Latin America's principal telecom provider, with a booming sideline in Internet access.
Telefónica's media activities are due to be partially spun off shortly, and analysts said Endemol would take the media unit's assets up to 12 billion euros. Telefonica has listed shares in its Internet access unit, Terra Networks, and its phone directory publishing business over the past year. Both have been wildly successful additions to the stock market.
The deal is a reflection of the growing convergence between telecom and content providers, a trend exemplified by America Online's purchase of Time Warner. Time Warner is the parent of CNN.
Endemol's majority shareholders, John de Mol and Joop van den Ende, have agreed to tender their shares. Telefónica is offering 5.58 of its shares for each Endemol share.
Endemol shares surged 14 percent to 141.30 euros in early Amsterdam trading. In Madrid, Telefónica stock was 1 percent lower at 27.60 euros.
-- from staff and wire reports