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UK regulator rules on Disney offer level for Sky

The UK’s Takeover Panel has today (Thursday) confirmed that US media company Disney may have to offer a minimum of £14 (€16/$18.5) per share to acquire pan-European pay-television broadcaster Sky.

The Panel has confirmed an earlier ruling it made on July 13, which had since been followed by a series of hearings to review the base level for an offer after a number of appeals were lodged over the decision.

Disney would only be required to make an offer if it seals a deal to buy 21st Century Fox’s television and film assets, which include a 39 per cent holding in Sky, before either Fox or fellow US media company Comcast succeed in taking control.

Fox last week posted its formal offer document for control of Sky, without improving its price. Instead, Fox chose to trigger a 46-day deadline in which it can raise its current £14 per share bid. Under British takeover regulations, Fox now has until September 22 to potentially beat the existing top offer from Comcast.

Comcast last month moved swiftly to counter the enhanced takeover offer submitted by Fox for Sky by entering a new bid to exceed that of its rival. Comcast’s move came just hours after Fox announced its improved offer and intensified the race for control of Sky. Comcast’s offer for the entire issued and to be issued share capital of Sky is worth £14.75 per share, valuing the broadcaster at approximately £25.9bn.

Fox’s offer of £14 per share values Sky at £24.5bn and came after 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 per share represented a 16 per cent increase in value over the prior 21st Century Fox offer, which valued Sky at around £19bn. Comcast’s initial cash proposal implied an equity value of £22bn for Sky.

Comcast’s offer is for all of Sky, while Fox is seeking to secure full control of the company by acquiring the 61 per cent stake it does not already hold.