Comcast's $31 Billion Bid for Sky Could Crush Rupert Murdoch's Dreams

Virginia Carson
April 26, 2018

The U.S. media giant Comcast made a 22 billion pound ($30 billion) bid for Sky on Wednesday, topping a rival bid by Rupert Murdoch's Fox.

The terms are broadly in line with Comcast's February statement - shareholders are being offered £12.50 a share, higher than the £10.75 on offer from Fox for the 61 per cent of Sky it does not already own.

Comcast's chairman and chief executive Brian Roberts said Sky withdrawing its recommendation was what it wanted to achieve by formalising its offer on Wednesday.

Comcast - the biggest United States cable TV firm that also owns the NBC network and Universal Pictures - said its bid offered a premium of about 16% to the Fox's £10.75 a share offer.

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The Comcast bid also comes without the difficulties surrounding the 21 Century Fox bid and Rupert Murdoch's existing ties to the United Kingdom news industry. It is led by a terrific management team who we look forward to working with to build and grow this business.

Sky shares rose 3.5 percent to 13.54 pounds by 1310 GMT - well above the offer price, implying that some shareholders anticipated a bidding war.

It said Sky would "co-operate fully" with both parties but also welcomed Comcast's bid, saying it believed its voluntary commitments to the company under the offer "should comprehensively address any potential public interest concerns".

Comcast said its bid came with a series of legally binding commitments on Sky ownership and United Kingdom investment. Sky will be our platform for growth across Europe. He noted both companies' combined customer base of about 52 million would allow Comcast to invest more in original and licensed programming, as well as technology.

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Roberts said he did not see any material issues with securing regulatory approval for the deal. Comcast will also need to get regulatory green lights, but will not face some of the issues that have beset the Fox bid, such as control of news outlets in the United Kingdom.

In a move to address those concerns, the Comcast offer states the USA company's intention to not acquire a majority interest in any newspapers in the United Kingdom for five years, and the establishment of a Sky News board that will ensure the editorial independence of Sky News for a 10-year period.

The owner of Universal Pictures shows its hand, prompting Sky to withdraw its recommendation of a deal with 21st Century Fox.

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