BT is seeking to sell a stake in its pay-TV sport business, which airs content including Premier League and Champions League football, and is understood to have held talks with companies including Amazon, ITV and the sport streaming service Dazn.
The telecoms company, which has invested billions in sports rights to build BT Sport into a viable competitor to Sky, is assessing all options including a full sale, joint venture partnership with a media company or selling a stake.
“Further to media reports, BT can confirm that early discussions are being held with a number of select strategic partners to explore ways to generate investment, strengthen our sports business and help take it to the next stage in its growth,” said the company, which has appointed the investment bank Lazard to explore strategic options. “The discussions are confidential and may or may not lead to an outcome.”
BT has opened talks with a range of potential companies including Amazon, which streams sport including live Premier League matches on its Prime Video service, Dazn, the sports streaming service owned by Sir Leonard Blavatnik, Disney, ITV, as well as private equity companies. The talks were first reported by the Telegraph.
BT’s share price rose almost 3% as investors welcomed the potential cash injection and sharing of costly sports rights bills.
BT launched the pay-TV service in 2012 to try to match Sky and stem the loss of millions of broadband customers to its rival. The strategy has worked, although it has cost BT billions of pounds in investment in a series of bidding wars with Sky to secure prime sports rights over the last decade, although BT Sport itself has only attracted a few million subscribers.
In recent years the battle between BT and Sky has cooled, following a groundbreaking channel-sharing deal so customers can watch all Premier League games without being forced to buy separate TV packages, with the telecoms pegging back spend to settle as a “viable second” player in sports broadcasting in the UK. The company has instead looked to focus on aggregating content through its BT TV service, offering content from partners including Sky, Netflix and Amazon.
With broadband customer churn now stabilised, BT is seeking to refocus its business on its core telecoms operation. The company is investing £12.5bn in upgrading much of the UK’s internet network to next-generation full-fibre broadband, and is spending billions on building its 5G mobile network.
BT also has a pension deficit of about £9.5bn, with payments of close to £1bn annually, which some expensive sports rights deal money could be redirected to covering if a partner were found for BT Sport. It is understood that while BT would entertain an offer for the outright sale of BT Sport, it is more inclined to retain a stake in the business.
At the last Premier League rights auction in 2018, total takings came in about £600m lower than the previous record £5.1bn, the first decrease since the 2004-05 three-year cycle of rights. The Premier League is currently seeking government approval to avoid an auction for the next rights cycle, which covers 2022-25, instead striking direct deals with existing rights holders Sky, BT and Amazon.