All eyes on Sky as bidding war lifts its value above rival BT
THE potential bidding war over Sky has propelled it beyond its old rival BT to become Britain’s most valuable pay-tv and broadband operator. Sky passed the landmark as its shareholders crossed their fingers for a fierce battle between media mammoths Comcast, 21st Century Fox and Disney.
Sky shares have surged 24pc in four days after US cable giant Comcast emerged with a shock £22bn bid, taking it ahead of top shareholder Fox in the race to snap up the company. While Sky has become the hottest takeover target on London’s market, BT endured a miserable 2017, plagued by accounting scandals, and profit warnings as it shed 26pc of its value. Exactly two years ago, BT’S £49bn valuation dwarfed Sky’s £18bn.
As investors awaited Rupert Murdoch and Fox’s countermove, Sky shares nudged up 1.5p to £13.73, bringing its market capitalisation to £23.6bn, some £170m higher than BT, which slipped 3.8p to 236.3p.
Elsewhere, Debenhams pulled away from a nine-year low on hopes that Sports Direct is poised to swoop for the embattled department store firm after upping its stake to 27.6pc.
Under UK takeover rules Sports Direct would have to make an offer if its holding exceeded 30pc and rumours of boss Mike Ashley’s ambitions for Debenhams have swirled the City since the FTSE 250 company built up its stake in the high street struggler last year. Sports Direct added fuel to the fire yesterday by releasing a statement talking up the “scope for greater collaboration” between the two retailers, arguing that the selfproclaimed “Selfridges of sport” can “complement Debenhams very well”.
Analysts had speculated that the company would struggle to engineer a bid after leaving itself little headroom by launching a £100m buyback programme last month, but investors saw a glimmer of hope for Debenhams, boosting it 0.6p to 28.4p. Trading platform
Plus500 tumbled 99p to £10.70 after its five founders cashed in on its recent price rally by selling 7.3m shares for £80m. The payday came after its shares surged as much as 185pc in a year by riding the cryptocurrency craze. Asos dipped 90p to £70.80 on announcing the sudden departure of chief financial officer Helen Ashton, while power generation giant Drax advanced 11p to 264p after being upgraded to “outperform” by analysts at Exane BNP Paribas.
Donald Trump’s stepping up of efforts to protect US industry by imposing huge tariffs on steel and aluminium imports rocked markets and sent stocks sliding. With markets already under pressure from Federal Reserve chairman Jerome Powell’s hawkish lean in his first grilling in Congress this week, fears of a global trade skirmish dragged the FTSE 100 to a 105.74 point loss at 7,069.90.
As investors scurried out of riskier stocks in search of safe haven assets, shares in Europe extended their losing streak to a fourth day while equities in New York tumbled again at the opening bell.