Sky sale: Murdoch bows out of U.K. TV

LONDON • Rupert Murdoch has bid farewell to the British television industry after 21st Century Fox Inc. agreed to accept Comcast

Corp.’s bid for Sky. Fox, which has been under the control of Disney in the extraordinary takeover battle, said it would tender its 39-per-cent stake for 11.6 billion pounds (US$15.3 billion).

Fox did not intend to control Sky for the long term going into last weekend’s record-breaking blind auction against Comcast. The Murdoch family had already agreed to sell most of its assets, including its stake in Sky, to Disney for $US71 billion.

If Fox had won the auction, Disney would have taken control of Sky next year. It was comfortably outbid, however. Disney allowed Fox to bid 15.67 pounds per share for Sky, almost three billion pounds short of the 17.28-pounds-per-share offer from Comcast, which valued Sky at 37 billion pounds including debt.

Analysts speculated Disney chairman Bob Iger might seek to use Fox’s stake in Sky as a bargaining chip in separate discussions over the future of Hulu, a U.S. subscription streaming joint venture. Comcast is a 30-per-cent shareholder in Hulu, while following the completion of its deal with Fox, Disney will have 60 per cent.

Iger has opted to take Comcast’s cash rather than risk being stuck with a large minority shareholding in an unlisted Sky. Disney is investing heavily in a new international streaming service to take on Netflix. Comcast’s cash will reduce its debt burden as a result of the Fox deal.

Murdoch founded Sky in 1989 and almost bankrupted his empire to create the payTV operator in the face of opposition from the broadcasting establishment.

FOX DID NOT INTEND TO CONTROL SKY FOR THE LONG TERM.