USA cable giant Comcast joined in the battle for pan-European satellite TV group Sky on Tuesday, outbidding Rupert Murdoch's 21st Century Fox, whose takeover ambitions have hit United Kingdom government resistance. Will Disney be content with acquiring Fox without Sky?
He pounced Tuesday as Comcast said it would offer Sky shareholders $31 billion for the satellite TV company.
21CF was bidding for Sky ahead of selling a range of assets to Disney, including its Sky shareholding. "Sky shares are now trading 2 percent above the Comcast offer price, so the market clearly smells the scent of some more action before this saga draws to a close". It also would expand Comcast's global footprint to more effectively compete in the rapidly changing and intensely competitive entertainment and communications landscape.
Comcast has circled 21st Century Fox in the past.
Comcast is one of the world's largest media and telecoms companies, with a market value of $184bn, but it relies on the United States for the lion's share of its revenues.
Sky said earlier on Tuesday that its independent directors are "mindful of their fiduciary duties and their obligations under the UK Takeover Code" and noted that no firm offer has yet been made. They have the resources to fund a much bigger bid. "A further statement will be made if appropriate". Fox would hand full control of Sky to Disney if its takeover is successful.
Shareholders feeling short-changed by Murdoch greeted Comcast by sending Sky shares soaring as much as 23 percent. The cable giant's offer is for a controlling stake in Sky, and amounts to 12.50 British pounds, or $17.43, a share.
Fox has since proposed several measures to try to assuage the regulator's fears over the Murdochs' potential influence.
Bob Iger's Disney has agreed to buy Sky from Fox, along with other assets, in a separate $52bn follow-up deal.
Comcast bid $60 billion previous year to clinch a deal with Murdoch's Fox before losing out to Disney. Instead, it indicated, it would be happy with the current 39 percent.
"Our strong market positions are complimentary with Sky's leadership in Europe enhancing our preeminent position in the US", Comcast's Roberts said.
But ill-timed scandals about sexual and racial harassment allegations at Fox's U.S. networks and pushback from United Kingdom regulators have plagued the deal.
Comcast Chief Executive Brian Roberts just did the deal equivalent of a photobomb.
Everything now points to a big-time two- or three-way fight for Sky. Sky shares jumped by a fifth on Tuesday morning and now trade nearly 7 percent above Comcast's bid.
This is not the first time Comcast and Roberts have disrupted Disney's best-laid plans.
Sky's move to launch its Sky Q service as a dishless OTT service in Europe mirrors Comcasts work to evolve Xfinity TV and X1.