Comcast’s takeover bid for Sky has today (Friday) been approved unconditionally by the European Commission, setting up a multi-billion battle for the pan-European pay-television broadcaster with rival US media company 21st Century Fox.
Comcast in April announced a firm superior cash proposal to acquire Sky, which is operated by 21st Century Fox. Comcast’s announcement of a superior cash proposal of £12.50 (€14/$17) per share represented a 16 per cent increase in value over the existing 21st Century Fox offer, which values Sky at around £19bn. Comcast’s superior cash proposal implies an equity value of £22bn for Sky.
Comcast’s offer is for all of Sky, while Fox, which already owns 39 per cent of the broadcaster, is seeking to secure full control of the company by acquiring the 61 per cent stake it does not already hold.
The EC today said that the Comcast transaction would raise no competition concerns in Europe. It added in a statement: “Comcast and Sky are mainly active in different markets in Austria, Germany, Ireland, Italy, the UK and Spain. They compete with each other only to a limited extent, mainly in the acquisition of TV content and in the wholesale supply of basic pay-TV channels.”
On April 7, the Commission also cleared unconditionally Fox’s offer for Sky. Earlier this month, the UK government gave the green light to a potential bidding contest between Fox and Comcast. Culture Secretary, Matt Hancock, approved Fox’s bid on the condition that the company offloads the Sky News operation to another organisation, which would guarantee its independence and support it financially for a minimum of 10 years.
Last month, Hancock said that he was unlikely to call for an investigation into Comcast’s bid. Regulatory scrutiny has held up Fox’s bid for the 61 per cent of Sky that it does not already own for almost 18 months.
Sky is a major sports broadcaster in the UK, as well as Austria, Germany and Italy. Earlier this week, Sky Italia and digital sports content and media group Perform acquired domestic rights to Serie A, the top division of Italian football, in deals worth a total of €973.3m ($1.166bn) per season.
The announcement by Lega Serie A on Wednesday evening followed a troubled year-long process to determine the league’s next set of rights for the three seasons spanning 2018-19 to 2020-21.