Sky’s share price rises as investors welcome Comcast’s successful tender offer

Sky’s shares rose 9% on Monday morning, after Comcast won a £ 30 billion bid for the broadcaster and defeated Rupert Murdoch’s Fox.

Fox and Comcast had been fighting for years to take control of the British company until the UK takeover committee made the unusual decision to decide on a bid for the buyer.

After a maximum of three betting rounds on Saturday, Comcast offered £ 17.28 per share, compared to £ 21.60 per share for the 61% of the company it does not hold yet.

The independent Sky Committee has asked shareholders to accept Comcast’s offer without delay.

Martin Gilbert, chairman of the committee, said the offer was “a great result for Sky shareholders” and represented a “significantly higher value” for Fox’s offering.

Suzanne Rab, a lawyer specializing in competition law at Serle Court, said: “Critics could say that blind auctions and sudden deaths lead to overvaluation.

“One could ask if Comcast’s bid is too high, but Sky has been described as a” single product “and a” crown jewel “.

With the acquisition of Sky, Comcast has acquired a customer base of 23 million as well as assets in several European markets. The company is struggling with a decline in the number of US customers as it fights against competition from competitors such as Netflix and Amazon, which is looking forward to the opportunity for diversification and expansion abroad.

Rebecca O’Keeffe, Investment Director at Interactive Investor, said: “The premium offered by Comcast shows how much pressure is being exerted on traditional media platforms and their new tech-savvy rivals have revolutionized the content. these technology giants are investing huge sums in popular shows and new content to retain more customers.

“Legal media companies are desperate for a place in this new order and consolidation in this sector should continue, with companies offering new markets and high demand opportunities.”

Mr. Murdoch’s Fox still owns more than one-third of the company, although she indicated that she is currently reviewing her options.

The media giant made a $ 8 billion profit for Sky in 2011, but his plans were disappointed by the phone piracy scandal that devoured his empire.

Regarding the transaction for Sky’s customers, Ms. Rab said: “They are unlikely to see an immediate change, only time permitting.” Comcast had to work hard to finance his offer. it is understandable to try to create synergies and reduce costs.

“The origin of these savings and the extent to which they are passed on to customers is unclear – anyone who controls Sky will not want to kill the golden goose by offering its growing customer base higher and lower prices. It will continue to invest in quality services and features, including world-class sports content, which is without a doubt one of the most valuable assets. “

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