[email protected]      +1 765-200-0323

Comcast outbids Fox in auction for Sky

Comcast outbids Fox in auction for Sky
By: Skynews Posted On: September 22, 2018 View: 11

Comcast outbids Fox in auction for Sky

Comcast has triumphed in the auction to buy Sky plc, the owner of Sky News, for £29.7bn in the biggest takeover ever seen in Europe's media industry.

Comcast's offer of £17.28 per share was £1.61 ahead of Fox's offer of £15.67.

The US giant's victory follows a dramatic shoot-out with US entertainment giant 21st Century Fox in a rare three-round auction overseen by the Takeover Panel.

The news ends 21 months of uncertainty for Sky over its ownership.

Both companies want Sky to help them compete more effectively with the new wave of online entertainment providers, including streaming services provided by the likes of Netflix and Amazon Video, who sell their content directly to viewers.

Brian Roberts is the chief executive of Comcast
Image: Brian Roberts is the chief executive of Comcast

Comcast in particular wants Sky to give it a presence in Europe and reduce its dependence on the US and has also made clear its admiration for Sky's technological know-how.

Disney, meanwhile, has been looking for a way to make its content available directly to viewers without having to go via a third party like a cable company.

Sky agreed to be taken over by Fox, its biggest shareholder, in December 2016. Since then, Fox has agreed to sell most of its entertainment assets to Disney, including its Hollywood film studio and its 39.1% stake in Sky.

However, the bid was held up by a lengthy series of investigations by the Competition & Markets Authority and by Ofcom, the broadcasting and telecoms regulator.

Bob Iger has headed Disney since 2005
Image: Bob Iger has headed Disney since 2005
Alice Enders, head of research at Enders Analysis 0:28
Video: Sky bid story 'not over yet'

That opened the door for Comcast to make a counter-bid for Sky. In July, it tabled a £14.75-a-share offer for Sky, valuing the company at £26bn.

That was the highest offer going into today's auction and compared with Friday night's closing price of £15.85.

Under the contest, Fox - as the lower bidder - was entitled to raise its offer first.

In the second round, only Comcast was allowed to raise its offer.

This meant the two sides went into a final "sudden death" round of bidding.

Such auctions are exceptionally rare. There have been only four since the rules were changed in 2002 and the most recent of these was in April 2008 when Enodis, a maker of kitchen equipment for McDonald's and Burger King, was acquired by the US company Manitowoc for £948m.

preview image 0:38
Video: Ian King: Comcast's 'knockout bid'

Brian Roberts, chairman and chief executive officer of Comcast said: "This is a great day for Comcast.

"Sky is a wonderful company with a great platform, tremendous brand, and accomplished management team.

"This acquisition will allow us to quickly, efficiently and meaningfully increase our customer base and expand internationally.

"We couldn't be more excited by the opportunities in front of us.

"We now encourage Sky shareholders to accept our offer, which we look forward to completing before the end of October 2018."

Comcast said its bid came with a series of legally binding commitments on Sky ownership and UK investment
Image: Comcast was bidding against Fox

Other companies whose fates have been decided by an auction overseen by the Panel include Corus, the owner of British Steel and Canary Wharf, the commercial property company.

However, in terms of the amount of money being paid, this auction is by far the biggest yet.

More from Business

Sky, which was founded in 1989, is Europe's biggest pay television broadcaster. It has 23 million household customers in the UK, Ireland, Germany, Austria and Italy, while it has recently launched "over the top" services in Spain and Switzerland.

It floated on the stock market in 1994 and, since flotation, has been a remarkably stable business, having had just five chief executives in the intervening 24 years - the late Sam Chisholm, Mark Booth, Tony Ball, James Murdoch - who is the current chairman of Sky and current chief executive of Fox - and Mr Darroch, the current incumbent.

Let's block ads! (Why?)

Read this on Skynews
  Contact Us
  World News Guru ( Global Ads Media Project )

1408 S Wester Ave Marion Indiana 46953 USA

Tel : +1 765 200 0323
Mail : [email protected]
Business Hours : 6:30 - 00:30

  Follow Us
Site Map
Show site map
  About

World News Guru is completely free and offers a broad range of media content from a varied and extensive range of sources. A global leader in online news, World News Guru Network presents news from more than 750 reputable sources including mainstream providers BBC, CNN, Reuters, Washington Post, The New York Times etc to more regional and localized sources. We deliver unparalleled coverage on a vast range of subjects. This provides users with a variety of perspectives and different interpretations on breaking news events.