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Fox highlighted Wednesday that its Sky stake is worth 11.6 billion pounds, or more than $15 billion at current currency exchange rates, under Comcast’s winning Sky bid. The planned sale will allow Comcast to take full control of Sky.
Comcast on Saturday won initial control of Sky with a higher $22.60 per-share bid for the European pay TV giant during a three-round auction showdown that valued Sky at 29.7 billion pounds ($38.8 billion), against Fox/Disney offering a final $20.50 per-share offer.
“In light of the premium Comcast has agreed to pay for Sky, we and Disney have decided to sell 21CF’s existing 39 percent holding in Sky to Comcast. We congratulate Comcast on their pending acquisition. We are proud of the role our company has played in building Sky, and of the outstanding value we have delivered for shareholders of 21CF and Sky, and customers across Europe,” 21st Century Fox said Wednesday in a statement.
Stock in 21st Century Fox rose 37 cents, or just under 1 percent, to $45.58 on the NASDAQ Exchange during late morning trading Wednesday, on news of the Sky stake sale to Comcast.
Walt Disney saw its shares rise $1.50, or 1.3 percent, to $115.20 on the NASDAQ Exchange. As a de facto backer of 21st Century Fox, Walt Disney agreeing to sell Fox’s 39 percent stake will allow that studio to reduce the cost of its separate transaction to acquire most of the assets of 21st Century Fox.
“Along with the net proceeds from the divestiture … the sale of Fox’s Sky holdings will substantially reduce the cost of our overall acquisition and allow us to aggressively invest in building and creating high-quality content for our direct-to-consumer platforms to meet the growing demands of viewers,” Robert Iger, chairman and CEO of Walt Disney, said in his own statement.
Besides expanding its investment in its direct-to-consumer streaming services, to launch in 2019, Disney also signaled it will “seek to increase investment” in Hulu’s content offerings and international distribution, as Disney and 21st Century Fox each currently hold 30 percent stakes in the popular streaming platform.
Analysts had expected Disney to possibly bargain around Comcast’s own 30 percent stake in Hulu as it weighed whether to sell Fox’s 39 percent shareholding in Sky after it was outbid for the European pay TV giant.
Shares in Comcast were relatively unchanged on Wednesday, having risen by 16 cents, or .47 percent, to $35.56 on the NASDAQ Exchange during late morning trading. That came a day after stock in Comcast tumbled as analysts argued the U.S. cable giant overpaid for Sky as the European broadcaster faces increased competition from Netflix and other next-generation digital platforms.
Comcast in July bowed out of a showdown with Walt Disney for a large chunk of 21st Century Fox, including its Sky stake. Disney won the bidding war with an offer of $71.3 billion. Comcast said it would instead concentrate on Sky.
Jeremy Darroch, Sky Group chief executive, in his own statement praised Rupert Murdoch and his son, James Murdoch, for their support as shareholders and board members in helping to build Sky as a European media giant.
“On behalf of all our employees I would also like to thank James for his chairmanship as we have transformed Sky over the past decade,” Darroch said. “With 21st Century Fox announcing its intention to sell its shares to Comcast, we close one chapter while simultaneously opening another. Our aim is to make the next 30 years as exciting for customers, colleagues and all our stakeholders.”
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Women in Entertainment
Women in Entertainment 2022