Murdoch鈥檚 Fox raises offer for UK鈥檚 Sky in bid to fend off rival Comcast
Print Edition
Rupert Murdoch鈥檚 21st Century Fox has raised its offer for Britain鈥檚 Sky in an agreed deal valuing the pay-TV group at US$32.5 billion, seeing off rival bidder Comcast for now.
Fox, which has been trying to buy the pan-European group since December 2016, offered to pay 14 pounds per share, a 12 percent premium to Comcast鈥檚 offer, but below the 15 pounds Sky shares were trading at yesterday.
Analysts said the bid threw down the gauntlet for Comcast, the world鈥檚 biggest entertainment company, to return with a higher offer.
The US cable group gatecrashed Murdoch鈥檚 attempt to buy the 61 percent of Sky his group did not already own in February, when Fox was still firmly stuck in the regulatory process.
One top-40 Sky shareholder said they expected Comcast to come back with a counter bid for Sky.
鈥淭he end price really depends on the appetite of those companies and how much they are willing to take their leverage up and at what stage their shareholders say enough is enough,鈥 the shareholder, who did not wish to be identified, said.
The fight for Britain鈥檚 leading pay-TV group is part of a bigger battle being waged in the entertainment industry as the world鈥檚 media giants offer tens of billions of dollars in deals to be able to compete with Netflix and Amazon.
Comcast and Walt Disney are locked in a separate US$70 billion-plus battle to buy most of Fox鈥檚 assets, which would include Sky.
Disney secured conditional US approval to buy the assets last month, giving it an edge over Comcast鈥檚 bid.
Hong Kong-based hedge fund Case Equity Partners, a Sky investor, said the fact Disney was in a slightly more favorable position for Fox鈥檚 US media assets meant Comcast would fight even harder to get Sky.
鈥淭oday鈥檚 Fox bid is unlikely to be the end game as we see a final Sky deal outcome at well over 15 pounds per share,鈥 said managing partner Michael Wegener.
Comcast declined to comment on Fox鈥檚 new offer.
Present in 23 million homes across Europe, Sky is a prized asset, with a direct relationship with its customers and a slate of top sport and original drama content.
鈥淭his transformative transaction will position Sky so that it can continue to compete within an environment that now includes some of the largest companies in the world,鈥 Fox said.
Its offer represents an 82 percent premium to Sky鈥檚 shares in 2016 before the takeover drama started, and a multiple of 21 times 2017 earnings per share.
Sky鈥檚 senior independent director Martin Gilbert welcomed the move. 鈥淭his offer reflects the strong position the business is in and is an attractive premium for shareholders,鈥 he said.
However, British regulators have indicated that if Disney succeeds in buying Fox, including the 39 percent stake in Sky, it would be required to offer the same price for the remainder of Sky. According to some shareholders, that has set an implied higher floor for Sky鈥檚 shares.
Hedge funds including Elliott have bought into Sky in recent months and other vocal shareholders such as Crispin Odey have demanded that the independent directors secure a better deal.
鈥淚t鈥檚 too low,鈥 Odey, a former son-in-law of Murdoch whose eponymous hedge fund is a Sky shareholder, said of the sweetened Fox offer.
鈥淒isney鈥檚 internal forecasts now, on the basis of the cash flows they鈥檝e published for Sky, would value it at 16 pounds,鈥 he said.
Investors argue that Sky鈥檚 continued strong trading performance, and its deal this year to secure the rights to English Premier League football at a lower than expected price, meant it warranted a higher offer.
Fox said the performance of Sky since 2016 justified its new bid. Analysts said it was not a knock-out, and Fox did not say it was its final offer.
鈥淔ox coming back in for Sky isn鈥檛 a surprise in itself, but the fact the offer is slightly behind what some had anticipated brings another twist,鈥 said George Salmon, equity analyst at Hargreaves Lansdown.
The British government is expected to finally allow Fox to buy Sky this week, after the US group agreed to sell Sky鈥檚 award-winning news channel to Disney to prevent Murdoch from owning too much of the British media.
Fox, run by Rupert鈥檚 son James who is also the chairman of Sky, has made a string of guarantees to help secure backing for its deal, including investment in British TV production, technology and protection for Sky News.
Murdoch had previously tried and failed to buy Sky in 2011.
- About Us
- |
- Terms of Use
- |
-
RSS - |
- Privacy Policy
- |
- Contact Us
- |
- Shanghai Call Center: 962288
- |
- Tip-off hotline: 52920043
- 娌狪CP璇侊細娌狪CP澶05050403鍙-1
- |
- 浜掕仈缃戞柊闂讳俊鎭湇鍔¤鍙瘉锛31120180004
- |
- 缃戠粶瑙嗗惉璁稿彲璇侊細0909346
- |
- 骞挎挱鐢佃鑺傜洰鍒朵綔璁稿彲璇侊細娌瓧绗354鍙
- |
- 澧炲肩數淇′笟鍔＄粡钀ヨ鍙瘉锛氭勃B2-20120012
Copyright 漏 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.
