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Austar confident on Foxtel merger

Follows net profit for the six months to 30 June, 2011, rose 328.5 per cent to $88.66 million

Austar United Communications reported a four-fold increase in first half net profit and expressed confidence a proposed merger with Foxtel would proceed.

The regional pay-tv provider said net profit for the six months to 30 June, 2011, rose 328.5 per cent to $88.66 million.

Revenue was flat at $351.75 million, Austar said in a statement on Friday.

Austar chief executive, John Porter, said there was a "compelling industrial logic to bringing Austar and Foxtel together", the transaction had the support of Austar's independent directors and would deliver a number of consumer benefits.

However, the Australian Competition and Consumer Commission has raised some initial concerns about the proposed tie-up in an initial statement on issues.

"I am confident that once the ACCC reviews our submissions there will be a reasonable result," Porter said in the statement.

Porter said, in an investor presentation lodged with the Australian Securities Exchange, that if the ACCC's issues were not resolved by the end of September "there may be a delay in the timetable".

"Assuming the ACCC issues are resolved by the end of September, implementation of a scheme of arrangement likely to be in either December 2011 or early 2012," he said.

Austar said subscribers grew by 8609 in the three months to 30 June, an increase of about two per cent from the prior corresponding period, to 764,250.

Average revenue per user grew by 3.5 per cent.

Porter said it was a difficult consumer environment, given natural disasters that have struck regional Australia.

"The outlook for subscriber growth for the rest of 2011 remains challenging with consumer sentiment at an all time low," Porter said.

Porter was to hold an briefing with analysts and media at 1100 AEST.

Nominations for the 2012 ARN IT Industry Awards open on Tuesday, June 12.

More about: ACCC, Austar, Austar United Communications, Australian Competition and Consumer Commission, Foxtel

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