The value of buying Tiscali can now be seen by BSkyB CFO

The purchase of the UK part of Italian broadband operator Tiscali would mean a huge rise in the amount of homes that pay-TV group BSkyB would be able to reach, and so doing this would be a sensible choice.

In response to this news the share value of Tiscali soared by 8.4 percent with a value of 0.738 Euros, which beat the increase of the DJ Stoxx European media index of just 2.8 percent.

At a recent investor conference Andrew Griffin, a Chief Financial Officer said “At the moment, we only address 9 million homes, so Sky broadband products — great value though they are — only speak to customers who are willing to take the TV offering.
He continued by telling the UBS conference “Something like Tiscali would allow us to extend our offering and our services in a scale industry to another 16 million households, and that potentially could have value.”

Up until now Sky had declined to make any kind of public statement even though Tiscali had said that it was discussing the sale of its British assets with Sky last month. The current Tiscali UK asset value was recently placed at around 500 million pounds by recent media reports.

During a Webcast that was monitored by Reuters Griffith qualified the remarks he made by saying “Any consolidation of broadband we look at through a pretty sceptical gaze, because I have no doubt that we can meet our organic targets alone.”

With regards to the British broadband business of Tiscali he added “It’s something that’s very core, and very adjacent to existing processes and management layers that we’ve got and of course would be in our core market, the UK.”

Tiscali had been saying that it had an interest in selling its assets for many months as the company has been reduced from a pan-European player to a business that was focused solely in Italy and Britain after several years of restructuring.