Markets

Comcast challenges Murdoch with rival bid for UK-based Sky

Comcast challenges Murdoch with rival bid for UK-based Sky

On Wednesday, the Comcast Corporation made a formal bid to buy a majority control of Sky in a deal valuing the British company at $31 billion.

Sky's independent directors welcomed Comcast's 12.50 pound per share bid and said they would now engage with both Comcast and Fox.

Fox has seen its bid for full control of Sky, which was first tabled in December 2016, held up by a series of regulatory investigations.

Notes the Wall Street Journal this morning: "Separately, Comcast is weighing whether to play interloper on the pending Walt Disney Co. acquisition of 21st Century Fox's entertainment assets, people familiar with the situation say".

Comcast said in a statement that acquiring Sky would help the company expand its worldwide footprint in the United Kingdom and Continental Europe and serve as a platform for growth across Europe. These include a promise to maintain investment in Sky News and preservation of its editorial independence - "issues that have become sticking points for the United Kingdom regulators scrutinising the Fox bid for Sky", says the Financial Times.

The company also said it would maintain the funding and independence of Sky's news operation for at least 10 years and pledged that it wouldn't buy any British newspapers for at least five years.

US trade officials to travel China
The Commerce Ministry in Beijing said last weekend that China would welcome a visit from the U.S.to discuss trade issues.

They said: "The question now is whether Fox/Disney makes a knock-out bid to discourage any further Comcast offer and what it thinks this level is, without breaking the bank".

Sky News has become a flash point in the Fox's bid due to competition fears centring on Mr Murdoch's ownership of The Sun, The Times and The Sunday Times newspapers. "We have long believed Sky is an outstanding company and a great fit with Comcast".

"We also understand the role that Sky plays in United Kingdom society and in its customers' lives, and we are determined to be responsible and trusted owners of Sky", Roberts said in a statement. Sky is a highly complementary business and will expand Comcast's worldwide footprint in the United Kingdom and Continental Europe. Sky also has the rights to broadcast major professional sports events including games in the English Premier League.

It said Sky would "co-operate fully" with both parties but also welcomed Comcast's bid, saying it believed its voluntary commitments to the company under the offer "should comprehensively address any potential public interest concerns".

Shares of Sky have gone up by almost 4% to approximately $1359.00, while shares of 21st Century Fox have only risen by about 2%, to almost $36.20.

Comcast, which owns cable channels MSNBC and CNBC, has already said it believes its approach would escape concerns over media plurality because of its "minimal presence" in United Kingdom media.