Comcast Formalizes $30.7 Billion Bid for Sky

Apr 26, 2018, 00:45
Comcast Formalizes $30.7 Billion Bid for Sky

Now Comcast has formally published a Rule 2.7 announcement under the City Code on UK Takeovers and Mergers announcing its pre-conditional cash offer for the entire issued and to be issued share capital of Sky. The morning announcement by Philadelphia-based Comcast spurred a series of rapid-fire responses.

Fox said in a statement it remained committed to its offer and was "considering its options".

Comcast added that it planned to agree several legally binding commitments with regard to Sky and in particular for Sky News, as well as keeping the group's Osterley headquarters in west London for at least five years.

The Bloomberg story also notes: "Fox, which already has a 39 percent stake in Sky, plans to sell the broadcaster to Disney as part of their $52.4 billion merger announced in December".

Sky's independent directors welcomed Comcast's 12.50 pound per share bid and said they would now engage with both Comcast and Fox. "The contest pits Iger against Comcast CEO Brian Roberts, after Disney won over Comcast in an earlier battle for Fox".

The news comes as Comcast released its financials for Q1 of 2018, boasting a 10.7% increase in consolidated revenue, a 3.6% increase in revenue for the Cable Communications division, and a 21.3% increase in revenues for NBCUniversal, driven by the broadcast of the PyeongChang Olympics and the Super Bowl.

US media conglomerate Comcast has made a 22 billion pound ($30 billion) bid for London-based pay TV operator Sky in move that threatens a rival bid by Rupert Murdoch.

The markets think there will be one as shares are trading £1 higher than the Comcast bid. Shares in 21 Century Fox opened in the green.

Following the Comcast bid, Sky said it is withdrawing its recommendation for the Fox bid.

It partly reflected expectations among investors that Fox and Comcast - along with potential other suitors - were likely to enter a bidding war. 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. It also owns movie studio Universal Pictures, home to "Minions" and "Jason Bourne" movies and some theme parks.

"When you see opportunities that won't come around again - unique opportunities - you have to consider that with extra focus", he said.

"We believe in the importance of news and the integrity that underpins it (and) we have a proven track record of stewardship and investment", he said.

Dang reported from NY.

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