Published: Thu, July 12, 2018
Money | By Armando Alvarado

Sky's the limit: Comcast raises bid to $34bn

Sky's the limit: Comcast raises bid to $34bn

Rupert Murdoch's 21st Century Fox said it had agreed to buy Britain's Sky in a deal valuing the pay-TV group at $32.5 billion, trumping a rival offer from U.S. group Comcast.

The American pay-TV group gatecrashed Murdoch's attempt to buy the 61 per cent of Sky his group did not already own in February, when Fox was firmly stuck in the regulatory process. Rupert Murdoch's company is willing to pay £14 (Rs 1,254) per share - or £32.5 billion (Rs 2.96 lakh crore) - instead of £10.75 (Rs 978) per share for Sky.

Fox is already Sky's biggest shareholder, with a 39.1% stake. "I think it will go at about 18 pounds".

That is a whopping 80% more than the market thought Sky was worth before the bidding war started. The European pay-TV company has become a pawn in a wider contest between Comcast and Walt Disney (dis) for the bulk of Murdoch's media empire, as each seeks scale to take on streaming competitors like Netflix.

"Today, 21CF and the Independent Committee of Sky are pleased to announce that they have reached agreement on an increased. cash offer", a statement said on Wednesday.

Following the announcement, Sky's share price was down 1.3 per cent at 14.81, though above the improved offer.

The new offer also bests Comcast's bid of £12.50 per share.

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The expectation from some analysts had been that Fox would wait for final United Kingdom approval before coming back with a higher bid, but with Prime Minister Theresa May's government committing to release a decision on Thursday, Fox pulled the trigger.

Of course, there's still time for Comcast to make yet another counteroffer, forcing Disney to increase its bid once more.

20th Century Fox recently set July 27 as the new date for stockholders to vote on the sale of their many film and television assets to The Walt Disney Co., which has also recently received USA anti-trust approval.

Martin Gilbert, deputy chairman of Sky, said that Comcast's offer represent an "attractive premium to the current alternative offer".

Sky operates in Austria, Germany, Ireland and Italy as well as the U.K. It has 22.5 million customers, attracted by offerings such as English Premier League soccer and "Game of Thrones".

Disney is reportedly thinking of selling off Fox's RSN's to various companies like AT&T, Charter and other companies.

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