- Comcast has officially made a £22 billion ($US30.7 billion) bid for Britain’s Sky.
- 21st Century Fox, which owns 40% of Sky, has been trying to buy the remaining stake since the end of 2016 but has faced repeated regulatory hurdles.
- Comcast’s offer is a 16% premium to 21st Century Fox’s most recent bid.
- Sky’s board withdrew its support for a Fox bid in response to Comcast’s offer.
Comcast on Wednesday said it was offering £12.50, or $US17.45, a share for the company. The bid represents a 16% premium on the latest offer from Murdoch’s 21st Century Fox. Comcast’s deal values Sky at £22.1 billion ($US30.9 billion).
Sky’s board responded by withdrawing its recommendation for investors to approve Fox’s December 2016 bid, which has been repeatedly hit by regulatory hurdles.
Comcast, which owns TV networks such as E! and NBC, as well as Universal Pictures, first announced plans to make a bid in February. It said the deal represented a “strategic opportunity to acquire a leading content and distribution business in the UK and Europe.”
Sky shares jumped 3% on news of the offer.
Sky is known in Europe for its live football (soccer in the US) broadcasts as well as for premium content such as HBO’s “Game of Thrones” and in-house productions such as “Fortitude” and “Britannia.”
Murdoch’s 21st Century Fox owns 39.1% of Sky, which Murdoch helped found in the 1990s. Murdoch has long coveted the remaining 61%, with a previous £8 billion takeover attempt derailed by the News of the World phone-hacking scandal in 2011.
21st Century Fox restarted takeover plans at the end of 2o16, but it has repeatedly run up against regulatory hurdles. The UK’s competition watchdog said in January that the deal would be “against the public interest,” giving the Murdoch family what it considered too much control over UK media.
Fox has already agreed on paper to sell its stake in Sky to Disney as part of a $US52.4 billion (£37.5 billion) package of film and TV assets. When the deal was announced, 21st Century Fox said it remained “committed to completing its proposed acquisition of the shares in Sky it does not own.”
Comcast was one of the interested bidders in Fox’s entertainment assets, according to multiple reports.
Comcast said it was planning to keep Sky headquartered in Osterley, would maintain its staffing levels, and would invest in creating more high-quality content. The company said it saw $US500 million of synergies from the deal.
“We have long believed Sky is an outstanding company and a great fit with Comcast,” Brian Roberts, the chairman and CEO of Comcast, said in a statement. “Sky has a strong business, excellent customer loyalty, and a valued brand. It is led by a terrific management team who we look forward to working with to build and grow this business.”
21st Century Fox said in a statement it “remains committed” to its December 2016 bid but added that it was “currently considering its options.”
The boutique London firm Robey Warshaw advised Comcast on the offer along with the investment banks Evercore and Bank of America Merrill Lynch.
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