Comcast is expected to raise its offer for Sky

Thursday, 12 Jul, 2018

Comcast, the world's biggest entertainment group, said it had secured the backing of Sky's independent directors for a 14.75 pounds per share offer that came just 16 hours after Murdoch's 21st Century Fox FOXA.O had offered 14 pounds. Fox already owns about 39% of Sky. Wright's predecessor had previously indicated the deal could go through if Sky was ultimately sold to a third party, like Disney. 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.

However, Comcast's new offer, more than 5% over Murdoch's latest deal, has won the recommendation of Sky's independent committee. Sky's shares closed at £15.01 on Tuesday, suggesting shareholders think the battle is not over.

Fox made the new offer in an attempt to outbid its rival Comcast, which has offered Sky £12.5 (Rs. 1,139) per share, CNBC reported.

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.

But Fox must promise to divest Sky News to assuage concerns over Fox controlling too much of the country's news media.

Fox said early Wednesday morning, "As the founding shareholder of Sky, we have remained deeply committed to bringing these two organizations together to create a world-class business positioned to deliver the very best entertainment experiences well into the future".

Sky's shares have risen 95 percent since Fox made its first bid in 2016, and have risen 55 percent in the a year ago. Comcast is said to be ready to negotiate with the feds on the number of Fox RSN's it would have to divest as some of them may overlap with Comcast's NBC Sports regional networks.

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

Another wrench has been thrown in the ongoing saga of the Disney Fox deal.