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Here’s the news: Sky gets surprise £22.1bn cash bid from Comcast, trumping Rupert Murdoch's Fox offer

Comcast, which owns NBC and Universal Pictures, said in a statement that it is offering 1,250p per share to Sky investors, significantly higher than the 1,075p a share Fox bid

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Comcast CEO Brian L. Roberts said: "We would like to own the whole of Sky and we will be looking to acquire over 50% of the Sky shares"

Sky PLC (LON:SKY) got a surprise on Tuesday after the biggest US cable operator, Comcast Corp. (NASDAQ:CMCSA) unveiled a possible £22.1bn (US$31bn) all-cash offer to buy the satellite broadcaster, challenging Rupert Murdoch's 21st Century Fox Inc’s (NASDAQ:FOX) takeover bid.

Comcast, which owns NBC and Universal Pictures, said in a statement that it would offer 1,250p per share to Sky investors, significantly higher than the 1,075p a share Fox bid to which Sky has already agreed.

READ: Sky’s ‘bargain’ Premier League rights deal could leave investors wanting more money from Murdoch

In a brief statement responding to the Comcast announcement, Sky said: ”Since no firm offer has been made at this point, shareholders are advised to take no action.”

The group added: ”A further announcement will be made as and when appropriate.”

Sky also said its independent directors “are mindful of their fiduciary duties and their obligations under the UK Takeover Code.”

Disney and Murdoch taken-on

The proposed offer pits Comcast not only against Murdoch, but also against Walt Disney Co. (NYSE:DIS) which has agreed to buy a string of assets from Fox once the deal is done, including Sky.

Comcast CEO Brian L. Roberts said: "We would like to own the whole of Sky and we will be looking to acquire over 50% of the Sky shares."

Fox agreed to buy the 61% of Sky it does not already own in December 2016 but the takeover has been repeatedly held up by regulatory concerns that Murdoch controls too much media in the UK and is being still investigated by the Competition & Markets Authority.

Some Sky shareholders have also started to complain that the Fox offer is too low.

Sky shares closed trading at 1,105p on Monday, above the Fox bid level, and soared 20.5% higher to 1,332p in lunchtime today.

Cat amongst the pigeons

Richard Hunter, head of markets at interactive investor, commented “Comcast’s approach for Sky is a fascinating development in the battle for media might.

“The deal would have attractions on a number of fronts, not least of which would be the removal of complexity from the current tripartite discussions between Fox, Disney and Sky. In a land where, increasingly, content is king, there would be synergies from a creative programming perspective, whilst the potential showstopper of media plurality concerns would probably not apply to the Comcast bid.

"Meanwhile, the combined group would have a stable of media, production and technology outlets which would position it strongly in any number of countries.”

He added: “In a normal takeover situation, the potential acquirer would be extremely keen to have the support of the largest shareholder in an effort to ease the deal through. Unlikely though it seems, this could yet happen, but it is equally plausible that Fox will need to return with an improved bid, which the market was beginning to anticipate in any event.

“Indeed, the initial share price reaction suggests that this story has further to run, with Sky’s price leaping above the level of the already increased Comcast offer.

Hunter concluded: “Whatever the outcome, Comcast has put the cat amongst the pigeons with a move which should make for compulsive viewing.”

 -- Adds Sky statement, updates share price --

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