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LONDON – Comcast's bid to acquire the bulk of 21st Century Fox's entertainment assets appears to be over. Instead, the cable giant will focus on fighting Fox for the control of Sky, one of Europe's most sought-after media companies
Comcast Wednesday increased its offer on Sky for $ 34 billion. pound sterling. This dominated an offer from 21st Century Fox, the media empire of Rupert Murdoch, who arrived earlier in the day. Fox's offer valued Sky at about $ 32.5 billion. Sky 's independent board of directors had already recommended the new Comcast terms.
But Sky is only one element of a larger and complex corporate confrontation. The latest move escalates a war between rival media companies on two continents and involving two different deals exceeding $ 100 billion in total value.
The Walt Disney Company and Comcast offered to buy most of Fox's entertainment assets, including Sky and another expanding international company, Star India, which would help increase their global reach. It is unlikely that Comcast will continue to pursue Fox and will instead focus its efforts on the acquisition of Sky, people familiar with the process.
Disney agreed to pay $ 71.3 billion for most of Fox, an agreement that Fox accepted and federal. the regulators have approved. The purchase of Sky's total control, which Disney's general manager, Robert A. Iger, called " a true jewel of the crown," is essential to this effort. Comcast is also motivated to take control of Sky, which has more than 23 million customers in five European countries.
Sky's previous bid was about $ 30 billion and had already received approval from the British government. Fox should receive approval for his candidacy as early as Thursday, but would still need to increase it to acquire Sky.
Fox underwent a strict 18-month review of his broadcaster lawsuit by the British government, which worried about Mr. Murdoch's potential to gain an important role in the country's information industry .
The bidding war for Sky comes amidst a complex set of requirements under British takeover rules. The increase in Disney's offer for Fox has also increased the value of 39% of Sky owned by Fox, which desynchronizes these shares with the remaining 61%. Fox's initial offer for Sky was valued at 23 billion pounds.
The British OPA panel, the government agency that reviews Sky's agreement, has not yet determined whether the requirement, called "chain principle," is the only way to go about it. would apply in this case. Normally, the agency requires a higher price for the entire company when part of the shares is purchased through another company. This possibility could reduce the interest in the higher offers for Fox because an increase in Fox's value could trigger rules that would require the buyer to offer more for the rest of Sky.
The panel also has the power to institute an auction. Under the terms of its revised offer, Comcast said it would pay 14.75 pounds per share Sky, about 5% more than Fox's offer of 14 pounds per share Sky.
] Disney and Comcast believe that Sky, which Mr. Murdoch founded three decades ago, is one of Fox's most sought-after assets, as its international presence would strengthen the global reach of every business. And Sky's broadcast rights ownership, including those of the English Premier League, is particularly appealing.
Sky has the ability to create content and distribute it via satellite and online video. to copy. This would help Disney or Comcast compete with the streaming services of technology giants like Netflix and Amazon who have changed the media landscape.
Following Silicon Valley's video ambitions has been a priority for traditional media companies that have largely decided to compete by opening their portfolios to make acquisitions.
Comcast said in a statement that he "has long admired Sky and believes that it's an outstanding company and a good fit."
Earlier in the day, Fox said in his statement, "This transformative transaction will allow Sky to continue to compete in an environment that now includes some of the largest companies in the world, but none of them Has demonstrated the same local depth of investment and commitment to the UK and Europe. . "
Mr. Murdoch has long believed in the value of Sky.He tried to gain full control of the broadcaster in 2010, but was forced to retreat amidst public fury following a scandal of telephone hacking involving his British tabloids.
He mounted his last push in 2016. The effort was weighed The British authorities fear that the Murdoch family is already exercising too much control over the country's media. Taking full control of Sky, including its 24-hour information operation, could go too far, government officials said
.Murdoch has moved to answer these questions with the help of Disney has proposed to sell Sky News to Disney to protect its editorial independence.New British secretary of culture, Jeremy Wright, is expected to announce a final decision on this plan this week.His predecessor, Matthew H ancock, was widely believed to endorse this solution
Comcast said that he was expecting to close the acquisition of Sky in October.
Follow Michael J. de la Merced on Twitter: @m_delamerced . Follow Edmund Lee on Twitter: @edmundlee .
Michael J. de la Merced reported from London and Edmund Lee from New York.
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