Two media giants appear to be heading for a takeover battle over British satellite broadcaster Sky, with Comcast on Wednesday making a formal $31 billion bid that tops the proposal of rival 21st Century Fox.

The Comcast offer values Sky at 12.50 pounds ($17.45) per share, a 16% improvement on the 10.75 pounds ($15.00) per share from Rupert Murdoch’s Fox that Sky had previously accepted. Comcast had made a preliminary proposal in February.

“We are delighted to be formalizing our offer for Sky today,” Comcast CEO Brian Roberts said in a news release. “We have long believed Sky is an outstanding company and a great fit with Comcast.”

Sky’s board welcomed Comcast’s overture. “As a result of the announcement of this higher cash offer, the Independent Committee is withdrawing its recommendation of [Fox’s] offer,” they said in a statement.

They said they would now engage with both Comcast and Fox, advising investors to take no action for now.

As The New York Times reports, Comcast has seized upon “Fox’s troubles in getting government approval for its bid,” with regulators concerned that buying Sky “would give Mr. Murdoch too much control over the country’s news media, given his ownership of newspapers like The Times of London and The Sun.”

“The proposed combination has been further complicated by Fox’s agreement to sell many of its TV and film assets to Walt Disney Co., including its stake in Sky, for $52 billion,” Reuters noted.

Comcast formalized its offer through what is known as a Rule 2.7 announcement in which it said it was committed to preserving Sky’s editorial independence and would not acquire a majority interest in any U.K. newspaper for five years “to ensure media plurality is sustained.”

Roberts said the Sky board’s withdrawal of its support for Fox’s offer was “the perfect step as far as we are concerned today.”

“The most likely scenario, according to many analysts, is that Fox, with Disney’s blessing, raises its bid,” Reuters said. “Fox has to at least match Comcast’s offer, but analysts estimate a final winning bid could go as high as 14 to 15 pounds per share.


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