×

Sky Auction: Comcast Beats Fox With $39 Billion Bid

Comcast has beaten 21st Century Fox in the high-stakes auction of European pay-TV giant Sky, coming out on top Saturday with a bid of £30 billion ($39 billion). The victory paves the way for the U.S. cable giant to put a leading offer to Sky shareholders and, if it’s accepted, to bolster significantly its international operations at a time of mega-consolidation in the industry and of rising global powerhouses such as Netflix.

Comcast bid £17.28 per Sky ordinary share versus Fox’s offer of £15.67 per share, which valued Sky at $32 billion. Comcast’s win came in a quick-fire shootout overseen by the U.K. Takeover Panel, which had ordered the unusual auction to end the prolonged stalemate between the two rival suitors. The auction is understood to have gone to the maximum three rounds.

Both offers will now be put to shareholders, who have until Oct. 11 to vote on them. Sky’s board is expected to issue a recommendation to shareholders shortly.

The auction’s outcome is sweet revenge for Comcast and CEO Brian Roberts, who were beaten by Disney in the tussle earlier this year for Fox’s entertainment assets, including Fox’s 39% stake in Sky. Roberts has called a Sky a “great business” that would complement his own media conglomerate, which already owns NBCUniversal and British production companies Working Title and Carnival Films (“Downton Abbey”). More important, adding Sky to Comcast’s stable will, at a stroke, boost international revenue from 9% to 25% of Comcast’s overall takings.

In Sky, Comcast would net a cutting-edge pay-TV service that boasts 23 million paying subscribers across Europe, in Britain, Ireland, Germany, Austria, and Italy. Under CEO Jeremy Darroch, Sky has maintained its offering of premium soccer, and other sports; moved into producing original content for TV (“Riviera,” “Britannia”) and film; and developed state-of-the-art digital and technology products, such as SkyQ and the Now TV streaming service.

Absorbing Sky would turn Comcast into a European channels heavyweight, grouping Sky’s entertainment and sports channels, including Sky Atlantic (which has output deals with HBO and Showtime), with NBCUniversal International Networks’ brands, such as Universal, E! and Syfy. Sky also operates content sales businesses that would join NBCUniversal’s own London-based content sales business, which boasts a library of more than 4,000 movies and 100,000 episodes of television.

Comcast was a late entrant into the fray for Sky, which Fox and Rupert Murdoch have been trying to buy for years. With Fox’s pursuit mired in regulatory scrutiny and political opposition, Comcast mounted a surprise bid last February with a $31 billion offer, a 16% premium on Fox’s existing offer.

“We think Sky is an outstanding company,” Roberts said at the time, calling the pay-TV company “a consistent innovator in its use of technology to deliver a fantastic viewing experience,” with a “proud record of investment in news and programming” and a “very strong and capable management team.”

Going into the auction after having already upped its original offer, Comcast still had the richer bid on the table, which Sky’s board had recommended to its shareholders, at £14.75 per share, versus Fox’s £14. But only a fraction of Sky’s shareholders voted to go with either offer, with the vast majority preferring instead to wait for even higher bids to come through as the takeover process played itself out.

According to the auction rules set by the Takeover Panel, Fox, as the party with the lower outstanding bid, was the first to submit a sweetened offer. Comcast had a right to counter, with both suitors then given the opportunity in a third and decisive round to make a final, take-it-or-leave-it offer. In stark contrast to the normal bidding process, which has stretched out over months, Saturday’s showdown unfolded within a day.

Though NBCUniversal occupies a large office space in Central London, Comcast has pledged to keep Sky’s sprawling campus in Osterley, on the western edge of the city.

(Pictured: Comcast CEO Brian Roberts and Sky CEO Jeremy Darroch)

More TV

  • David Benioff and D.B. Weiss

    'Game of Thrones' Showrunners Will No Longer Attend Comic-Con Panel

    “Game of Thrones” showrunners David Benioff and D.B. Weiss, along with some beloved “Thrones” actors, have canceled their scheduled appearances at San Diego International Comic-Con. Actors Iain Glen (Jorah Mormont), Nathalie Emmanuel (Missandei of Naath), director Miguel Sapochnik, and dual writer-producers Benioff and Weiss are no longer attending, HBO revealed in a revised panel lineup [...]

  • TV News Roundup: 'Mr. Robot' Drops

    TV News Roundup: 'Mr. Robot' Drops Season 4 Trailer (Watch)

    In today’s roundup, USA releases a trailer for the final season of “Mr. Robot,” Apple plans a “Snoopy in Space” series and Variety has an exclusive clip from Season 3 of Netflix’s “The Epic Tale of Captain Underpants.” CASTING Golden Globe-winner Ian McShane will guest star in the season premiere of “Law & Order: SVU.” [...]

  • Elisabeth Moss Handmaid's Tale

    Why Elisabeth Moss Deserves More than 'The Handmaid's Tale' (Column)

    Elisabeth Moss has a long talk with a somewhat less-than-present conversation partner, to which Moss herself brings a certain wired tension. Her physical posture, upright even as her voice frays with exhaustion, indicates as much as do her words a new resolve to do better than she’s done as a caretaker. Having run out of [...]

  • jeffrey hirsch Starz

    Listen: Starz COO Jeffrey Hirsch Spots an Opening in the Global Streaming Market

    Streaming content is about as competitive as a business gets these days, but don’t tell that to Starz COO Jeffrey Hirsch. He’s aggressively moving to establish the Lionsgate-owned premium programmer around the world while the time is right for his company to stake its claim. “Other than Netflix, we’re probably be the second or third [...]

  • Peak TV Saturation TV Placeholder

    USA Network Gives Series Order to 'Cannonball' Competition Show

    USA Network has given a series greenlight to a competition reality series “Cannonball,” from ITV Entertainment. The show revolves around 16 contestants who compete in a series of physical challenges. One contender will be eliminated in each episode. USA has ordered 10 episodes. The series is expected to bow next year. ” ‘Cannonball’ is pure [...]

More From Our Brands

Access exclusive content