Comcast Corp. increased its takeover bid for Sky Plc to $34 billion US, topping an offer from Rupert Murdoch’s 21st Century Fox Inc. and escalating a global standoff between the media giants.
Comcast, the largest U.S. cable company, is now offering 14.75 pounds a share for Sky, valuing Britain’s top pay-TV provider at 26 billion pounds, according to a statement Wednesday. That’s 5.4 per cent above a 14 pound-a-share proposal from Fox, which already owns a stake in the European broadcaster. Sky rose 3.2 per cent to 15.41 pounds at 8:05 a.m. in London as investors anticipated higher bids.
The move is the latest twist in an international M&A tussle that also includes Walt Disney Co. Both Comcast and Disney have been vying to acquire Fox’s entertainment assets — a contest that will affect the Sky bidding war. Comcast, which offered 12.50 pounds a share previously, said the sweetened bid won the backing of Sky’s independent directors and that it has lined up financing. Fox acknowledged the increased bid in a statement late Wednesday.
“There is a possibility Comcast puts a lot of chips backing its Sky bid and is less aggressive in its pursuit of Fox,” said Paul Sweeney, an analyst with Bloomberg Intelligence. The cable giant may “just want international scale.”
Comcast is still assessing its options on the other Fox assets it’s seeking, people familiar with the situation said, and has to consider the role the U.K. takeover agency plays in the bidding. If Comcast also raises its Fox bid, British regulators could demand the company also increase its offer for Sky, based on a rule known as the chain principle.