MEDIA Disney will have to buy all of Sky if UK regulator dismisses bid by Fox
Walt Disney will have to make an offer for the whole of Sky if the bid by 21st Century Fox to purchase the remaining 61 per cent stake in the European pay-TV company is unsuccessful, the UK’s takeover regulator said on Thursday.
The Takeover Panel also ruled that Disney would have to match Fox’s £10.75 (Dh56.03) a share offer for Sky, which is the same offered by Fox for the company stocks which it does not already hold.
The ruling is contingent on completion of Disney’s $52.4 billion purchase of Fox’s entertainment assets. Two years ago, Fox bid for the 61 per cent of Sky it does not control, following a failed earlier takeover attempt.
The Murdoch family, which controls Fox, wants to consolidate their hold on Sky as traditional media firms, faced with new competitors such as Netflix and Amazon, look to combine content creation and distribution channels.
Although the deal was approved by European authorities, it was derailed by Britain’s competition watchdog, who said in January that it is not in the public interest for Rupert Murdoch and his family to have “too much control” over the country’s media. They already have extensive media holdings, including stakes in newspapers such as The Sun and The Times.
While Fox’s Sky deal awaits approval, Disney made a separate bid to buy most of Fox back in December, including its existing stake in Sky. That deal is also awaiting regulatory clearance.
Forcing Disney to offer the same price as Fox did in 2016 is likely to disappoint some Sky shareholders who were hoping for a higher bid. However, it ensures a guaranteed bidder for Sky in the event that British regulators don’t sign off the Fox takeover.
Another twist in the tale came when American Comcast, which owns NBC and Universal, in February said it will pay £12.50 per share for Sky, setting up a race between the two media empires as they both sought to get their hands on the company set up in 1989 by Mr Murdoch.
If Comcast ends up acquiring Sky, Disney would not have to put forward a bid, the Takeover Panel said. The UK’s Competition and Markets Authority is currently reviewing Fox’s bid for Sky and is due to report to British Culture Secretary Matt Hancock by May 1, who will then have 30 days to decide whether or not to approve the deal.
In a separate development, Tom Watson, the deputy leader of the Labour Party, said that Fox’s potential involvement in a sports rights cartel should be taken into consideration by the regulators before they make a final decision on Mr Murdoch’s takeover of Sky.
It comes after the European Commission raided several media outlets on Tuesday, including the offices of Mr Murdoch’s Fox Network in London, for allegedly violating EU antitrust rules.