Canal Plus, TPS finalize sat merger

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PARIS -- French broadcaster Canal Plus has finalized its merger with satellite platform TPS, creating a single pay TV behemoth with close to 10 million subscribers, the companies said Friday.

Commercial broadcasters TF1 and M6 swapped their respective stakes in TPS in exchange for a stake in the new entity, which will be controlled by Vivendi through its Canal Plus Group's 65% stake, followed by Gallic media giant Lagardere with 20%, TF1 with 9.9% and M6 with 5.1%.

The former rivals hope that the long-anticipated merger will allow them to "effectively operate on the new competitive playing field and energize the television market for the benefit of consumers," Vivendi said in a statement.

French satellite TV customers, previously divided between CanalSat (with about 3.2 million subscribers) and TPS (1.3 million) will now be able to subscribe to a single service that will offer a wider variety of channels, though the exact number has yet to be determined.

Canal Plus France will include all of the group's pay TV activities in the market -- Canal Plus, CanalSat, TPS and the thematic channels -- but will not include Studio Canal, Canal Plus Poland and cable and satellite news coverage service I-Tele.

The effects of the deal have been visible since November when Canal Plus joined the TPS package and CanalSat subscribers were given access to TF1 and M6, though there is no word yet on how the new pay TV monopoly will package its new offer to consumers.

The reorganization of the satellite platform will take place from mid-January through the end of March and the companies expect to finalize the offer by the spring, a Canal Plus spokesperson said. The spokesperson said layoffs aren't out of the question as TPS' 600 employees join Canal Plus Group's staff of 3,500.

The merger aims to save TPS, CanalSat and Canal Plus a significant amount of money in advertising (on which the groups spent a combined total of €140 million in 2005), yet could prove more costly for consumers no longer wooed by special promotional deals.
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