21st Century Fox increases Sky bid offer | Media Investment | Business
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As it gears up to proceed with its bid to take full control of the European pay-TV giant, 21st Century Fox (21CF) has upped its bid to acquire Sky, upping that of rival Comcast.
Sky Q2Results 25Jan2018
Rupert Murdoch’s long-held ambition to acquire the 61% of shares in Sky that his media firm doesn’t hold was given a boost on 19 June when in a Parliamentary Statement assessing the respective bids for Sky from US cable giant Comcast and 21CF on 6 June 2018,  then UK Secretary of State Department for Digital, Culture, Media and Sport, Matt Hancock expressed no issue with the US cable giant’s bid but noted misgivings previously expressed by the UK Competition and Markets Authority (CMA) and broadcast regulator Ofcom regarding that by 21CF.

Whilst giving a virtual go-ahead to 21CF, the UK government noted that the acquisition remained subject to one outstanding precondition, that of the official approval of the UK Secretary of State which is due on 12 July 2018. On 9 July 2018, the UK appointed a new Secretary of State Department for Digital, Culture, Media and Sport.

Aiming to be fully set for the bidding war, 21CF has now increased its recommended pre-conditional cash offer for the fully diluted share capital of Sky which it and its affiliates do not already own at a price of £14.00 for each Sky share. This is £1.50 per share in excess of the Comcast big and values the pay-TV company at £24.5 billion.

Commenting on the new increased offer,  21st Century Fox said: “As the founding shareholder of Sky, we have remained deeply committed to bringing these two organisations together to create a world-class business positioned to deliver the very best entertainment experiences well into the future. We strongly believe that a combined 21CF and Sky will be a powerful driver for the continued growth and vibrancy of the UK and broader global creative industries. The enhanced scale and capabilities of the combination will enrich Sky’s ability to continue on its mission for years to come, especially at a time of dynamic change in our industry. This transformative transaction will position Sky so that it can continue to compete within an environment that now includes some of the largest companies in the world, but none of whom have demonstrated the same local depth of investment and commitment to the UK and to Europe.

“We said when we announced our proposed acquisition of Sky that we were firmly committed to UK’s creative industries and the contribution they make to the UK economy. We remain committed to the UK and believe that our offer for Sky will bring the best value for all the company’s stakeholders and are delighted that the Independent Board of Sky has recommended our offer to its shareholders.”

While it digests the new bid, Sky announced that it had completed the sale of its 20% stake in Sky Betting & Gaming (SBG) to The Stars Group for a total of £635 million. Sky noted that the disposal follows the initial sale of its majority stake in SBG to CVC Capital Partners in 2015 which, taken together, has crystallised a total value of nearly £1.4 billion for the company. The deal is part of a transaction under which CVC will sell the whole of its stake in SBG to The Stars Group.