Comcast tops Fox bid for Sky
February 27, 2018
Comcast has made a £22.1 billion (€25bn) takeover bid for Sky, challenging the existing offer from Rupert Murdoch’s 21st Century Fox. Fox’s board-approved deal to buy the 61 per cent of Sky it does not already own is subject to review by the UK’s Competition and Markets Authority.
Comcast said the bid of £12.50 per share was 16 per cent higher than the 21st Century Fox offer.
“We think Sky is an outstanding company. It has 23 million customers and leading positions in the UK, Italy, and Germany. Sky has been a consistent innovator in its use of technology to deliver a fantastic viewing experience and has a proud record of investment in news and programming. It has great people and a very strong and capable management team,” said Brian L. Roberts, Chairman and CEO of Comcast Corporation.
According to Roberts, Comcast intends to use Sky as a platform for growth in Europe. “We already have a strong presence in London through our NBCUniversal international operations, and we intend to maintain Sky’s UK headquarters. Adding Sky to the Comcast family of businesses will increase our international revenues from 9 per cent to 25 per cent of Company revenues.”
Comcast says the acquisition would enhance its entertainment, distribution, and technology leadership of Comcast, and importantly expand Comcast’s international footprint to more effectively compete in the rapidly changing and intensely competitive entertainment and communications landscape. The combined business would create compelling opportunities for growth and innovation, it says.
In a Statement on behalf of Sky, Chris Taylor, Company Secretary, said: “The Independent Committee of Sky notes today’s announcement from Comcast regarding a possible all cash offer for Sky at £12.50 per share (the ‘Possible Offer’). The Independent Directors of Sky are mindful of their fiduciary duties and their obligations under the UK Takeover Code. Since no firm offer has been made at this point, shareholders are advised to take no action. A further announcement will be made as and when appropriate.”
“This puts a real spanner in the works,” commented Paolo Pescatore, Vice President, Multiplay and Media at CCS Insight. “We’ve always said that Comcast has been sniffing around Europe. The bid offers plentiful opportunities for growth beyond the US and we’ve yet to see the same level of consolidation seen in this market. It is unsurprising that there is significant interest in Sky as it owns a wealth of content and has done a great job of moving into IP distribution. We strongly expect to see a bidding war for Sky. It has all the assets to compete with the web giants.”