Why Disney, Comcast want to buy the United Kingdom broadcaster
Mar 02 2018
Fox has already proposed a deal to buy the remainder of Sky that it doesn't already own for a cost of £18.5 billion.
Driven by its interest in controlling Sky, Comcast had offered $60 billion for much of Fox in December before Fox chose Disney's lower offer, a person familiar with the matter said at the time.
Comcast CEO Brian Roberts said that Comcast and Sky are the ideal fit, as both are leaders in creating as well as distributing content and Comcast believes Sky in an excellent company.
Unveiling the bid (PDF), Comcast CEO Brian Roberts described Sky as "an outstanding company" delivering "a fantastic viewing experience", which was a "consistent innovator".
The proposed offer pits Comcast against Murdoch, the 86-year-old media tycoon who helped launch Sky in Britain, and also against Walt Disney Inc, which has agreed to buy a string of assets from Fox once the deal is done, including Sky.
"This is tanks on their lawn", said Crispin Odey, Murdoch's former son-in-law and founder of hedge fund manager Odey Asset Management, which owns a 0.8 percent stake in Sky and has been pushing for a higher offer. In the meantime, Fox has agreed to sell assets to Disney in a follow-on deal, including Sky.
Sky's independent shareholders have yet to react to the deal, which would create a "unique leader in entertainment and technology with the resources and capabilities to compete, grow and thrive in a rapidly changing world", Roberts said.
Roberts added: "Comcast intends to use Sky as a platform for growth in Europe". One analyst in London said that the initial reaction of share price shows this story is not yet complete with the price for the stock already surpassing the higher offer by Comcast.
The long-running takeover battle for satellite broadcaster turned broadband and mobile provider Sky plc took another twist this morning when United States cable giant Comcast tabled a £22.1 billion bid for the company.
Comcast said it had only a minimal presence in the British media market and did not see any plurality concerns over its proposal. It snapped up Murdoch's pay-TV groups across Europe in 2014 to offer a distribution platform that is now proving attractive to the big USA content owners.
For his part, Roberts insisted that Comcast would do nothing to influence SkyNews' content. "Adding Sky to the Comcast family of businesses will increase our global revenues from 9 percent to 25 percent of company revenues".
When it comes to content, Sky's soccer offerings are especially attractive.
However, Sky responded by saying that "no firm offer has been made" and its shareholders should not take any action.
The deal would bring together Comcast's 29M subscribers in the USA with Sky's 23M subscribers across Europe, taking the combined total to over 50M. With Fox hitting a hurdle over its purchase of Sky, Comcast has rolled in hoping to purchase the European pay TV company.