Sky's dramatic takeover battle escalates with new Comcast bid

John Phillips  Getty Images

John Phillips Getty Images

After announcing its intention to make a £22 billion bid for Sky PLC previous year, Comcast has now confirmed its interest in the United Kingdom media business.

Comcast, whose interests include the NBC TV network and the Universal Pictures movie studio, followed through on interest it registered back in February with an offer of £12.50 per share on Wednesday morning. As a result of the higher offer, Sky said that it has withdrawn its recommendation to its shareholders of the 21st Century Fox bid, and is terminating its Co-operation Agreement with 21st Century Fox, entered on the date of the Fox offer.

It included a 10-year commitment to Sky News - its future proving one of the sticking points of the Fox bid which is still being considered by regulators over concerns it would hand the Murdoch Family Trust too much influence over United Kingdom media.

Comcast laid out a strategy that showed it was interested in being a good corporate citizen in Britain, promising to use Sky as a platform for growth in Europe, maintaining Skys U.K. headquarters and using the acquisition to expand its worldwide footprint. "Sky has a strong business, excellent customer loyalty, and a valued brand". But Comcast isnt wooing just Sky shareholders.

Its share price rose by over 4% following the announcement to £13.61 - significantly above the £12.50 per share offer by Comcast.

"Comcast believes that, combined, Comcast and Sky will create a business equipped to compete more effectively in a rapidly changing and highly competitive industry", the company said in its announcement.

Comcast CEO Brian Roberts said Skys 23 million customers and leading positions in the United Kingdom, Italy and Germany would provide "significant opportunities for growth". If he bought Sky, Murdoch would have "too much control over news providers in the United Kingdom across all media platforms and therefore too much influence over public opinion and the political agenda", the CMA said.

The Fox-Sky deal has been held up by concerns about the influence Murdoch could wield over public opinion through owning all of the broadcaster as well as British newspapers including The Times and The Sun. "We look forward to receiving the necessary regulatory approvals".

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