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Disney Required to Offer to Buy All Sky Shares if Fox Takeover Bid Fails

Disney will be required to make an offer to purchase all Sky shares if 21st Century Fox’s bid to acquire the remaining 61% of the satcaster is not approved prior to completion of Disney’s acquisition of Fox assets. the British Panel on Takeovers and Mergers has ruled.

The independent body said Thursday that The Walt Disney Company will be required to make a mandatory offer to all Sky shareholders of £10.75 upon completion of its acquisition of 21st Century Fox’s entertainment assets. The panel, which supervises and regulates takeovers in the U.K., confirmed that it had informed Disney, Fox and Sky, and that each company had accepted the ruling .

The statement read: “Following completion of the acquisition by Disney of Fox (after a spin-off of certain businesses), Disney will be required to make a mandatory offer to the holders of ordinary shares in Sky as a result of Fox’s stake of approximately 39% in Sky. The basis for this ruling is that the panel executive considers that securing control of Sky might reasonably be considered to be a significant purpose of Disney’s acquiring control of Fox.”

The panel said the offer was required to be £10.75 ($15.24) in cash for each ordinary share in Sky, which is in line with Fox’s existing offer in its bid for full control of Sky.

The offer is required to be made by Disney within 28 days of acquiring Fox unless Fox has completed its own takeover of Sky, which is currently under review by Britain’s competition watchdog, or if a third party has acquired more than 50% of Sky shares. Comcast announced in February that it was considering a rival all-cash £22.1 billion ($31.3 billion) offer for Sky, which would amount to £12.50 ($17.72) per share.

A response from Sky, noting the takeover panel’s ruling Thursday, advised Sky shareholders to take no further action at this stage.

Disney announced its $52.4 billion acquisition of 21st Century Fox assets in December, which includes Fox’s existing 39% stake in Sky.

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