Time Warner has bought a 10 per cent stake in Canal Satélite Digital (CSD), putting an end to speculation that Canal Satélite’s majority owner, Sogecable, planned to sell the platform to its rival, Telefonica-backed Via Digital.

The deal, announced last week, was estimated to be worth Ptas 5.49 billion (Euro 33 million). Time Warner originally took an option to buy shares in the Spanish DTH operator as part of a distribution deal signed in 1997, based on Sogecable’s value before its July IPO. The deal leaves Sogecable with 83 per cent of Canal Satélite Digital. Time Warner secured its stake at a favourable price. Since its IPO, Sogecable’s shares have more than doubled in value, as media shares generally have soared on the back of the Internet buying frenzy.

Sogecable and Time Warner are already partners in the CNN+ venture in Spain. Under the new agreement, Warner Bros will appoint a director to Canal Satélite’s board. Warner will also exercise a right to buy 10 per cent of Sogecable’s Cinemania unit.

Sogecable, Canal Satélite Digital’s owner, had previously told Spain’s Comision Nacional del Mercado de Valores (CNMV) that it had no intention of selling its stake in the pay- TV operation to its chief competitor. Sogecable denied absolutely rumours that it had started a process to sell the digital platform to Telefonica Media. It was rumoured that Sogecable could sell CSD to Telefonica Media to create a merged digital platform with Via Digital before summer.