21st Century Fox Ups Sky Bid To $32.5B, Topping Rival Comcast

Comcast

Rupert Murdoch's 21st Century Fox Inc. boosted its bid for Sky Plc, topping a rival offer from Comcast Corp.in the battle or control of Britain's top pay-TV company.

The U.S. cable group gatecrashed Murdoch's attempt to buy the 61 percent of Sky his group did not already own in February, when Fox was still firmly stuck in the regulatory process.

Fox could face further competition from the United States cable giant Comcast, however, after it forced Sky's independent directors to drop their previous backing for Fox with an unexpected £12.50-a-share bid for the group in February.

Sky's independent committee said Wednesday Fox's new bid "represents a substantial increase in value relative to the Comcast offer", and it will "unanimously recommend" the offer to Sky shareholders, according to the Financial Times.

Sky gives Fox and Comcast a rare opportunity to diversify out of the USA and reach more consumers directly.

"They're way behind the curve still", said Crispin Odey, founder of Odey Asset Management LLP, which owns shares of Sky.

Indeed, there is speculation that, should Disney prevail in the fight for Fox, Comcast would redouble its efforts to nab Sky, which would add a valuable global component and new revenue stream to the USA cable giant's portfolio.

The bidding for Sky and the broader protracted fight over ownership of Murdoch's entertainment assets between Comcast and the Walt Disney Co. seems no closer to a conclusion even after Wednesday actions, which were surprising only in that both Comcast and Fox seemed eager to get the fight on. Fox wants a deal at 14 pounds a share.

The UK government has already said it's likely to approve Fox's bid for Sky after Fox satisfied concerns over media plurality. The new bid values Sky at $32.5 billion. "We will be posting our offer document to Sky shareholders shortly".

Earlier this week one of Fox's shareholders filed a lawsuit to halt the proposed Disney acquisition, claiming that what was filed with the Securities and Exchange Commission wasn't an accurate estimation of future earning - specifically, the lawsuit takes issues with the lack of projections for Hulu's future earnings, as well as the estimates for European broadcaster Sky in the years to come.

Fox said the performance of Sky since 2016 justified its new bid.

Murdoch had previously tried to buy Sky in 2011 when a phone hacking scandal at his News of the World tabloid sparked a political backlash over his role in Britain.

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