LONDON: Though Flextech has apparently called off the deal between its children’s satellite and cable venture TCC and the Fox Children’s Network (FCN), rumors still abound of buy-ups and secret negotiations.

The proposed deal, whereby Flextech would sell 50 percent of TCC to FCN, was complicated by the addition of Saban Entertainment as a supplier to the new network. It is understood that the contract fell apart although due diligence had been completed.

Sources insist that FCN will still arrive in the U.K. this fall as part of the Sky Multi-Channel Package, and there is no suggestion that the Fox/Saban arrangement has been affected by the latest developments.

FCN would arrive, however, in a crowded children’s satellite and cable market currently led by Turner’s Cartoon Network and Viacom’s Nickelodeon. TCC, which since its launch as the The Children’s Channel has struggled against the two U.S. giants, is understood to be working on another ‘revamp’ focusing on its teenage successes California Dreams and Sweet Valley High.

However, conflicting reports suggest that the breakdown may be no more than a lover’s tiff. ‘They [Fox and Flextech] have both spent so much time on this deal that they can’t let it go this easily,’ says one insider.