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Comcast fires new salvo in £26bn battle for Sky

12 July 2018

The improved offer from Fox for the 61% of Sky it does not already own sets a price of £14 per share, which is a 30% rise from its original offer in December 2016 of £10.75 per share and puts the overall valuation of Sky at £24.5 billion. Sky's shares closed at 15.01 pounds on Tuesday, meaning shareholders may also not like the price.

"Today, 21CF and the Independent Committee of Sky are pleased to announce that they have reached agreement on an increased. cash offer", a statement said on Wednesday.

Fox said its ownership of Sky would position the satcaster "to compete within an environment that now includes some of the largest companies in the world, but none of [which] have demonstrated the same local depth of investment and commitment to the United Kingdom and to Europe".

Last month, the U.S. Department of Justice gave the go-ahead to Disney's acquisition of the Fox assets, asking Disney, which owns sports network ESPN, to divest all of Fox's 22 regional sports networks, known as RSNs, on antitrust grounds. The European pay-TV company has become a pawn in a wider contest between Comcast and Walt Disney (dis) for the bulk of Murdoch's media empire, as each seeks scale to take on streaming competitors like Netflix.

Comcast has said that Sky is very important because it could take the USA -bound cable and internet giant into global markets.

"This transformative transaction will position Sky so that it can continue to compete within an environment that now includes some of the largest companies in the world", Fox said.

Its offer represents an 82 percent premium to Sky's shares in 2016 before the takeover drama started, and a multiple of 21 times 2017 earnings per share.

21st Century Fox is the parent company of FOX News and FOX Business.

"Disney's internal forecasts now, on the basis of the cash flows they've published for Sky, would value it at 16 pounds", he said.

Unfortunately, Fox's troubles are not over yet as a shareholder Robert Weiss has initiated a lawsuit in order to prevent the deal from going ahead, according to the Hollywood Reporter.

One hedge fund manager with a stake in Sky welcomed that pledge as a sign that Disney backed Fox in the battle.

Tom Watson, a British Labour Party politician and opponent of Fox's bid to buy Sky, told Variety that a bidding war could be a good thing for shareholders but that it is more important to protect Sky.

Comcast fires new salvo in £26bn battle for Sky