21st Century Fox tables $14 bn preliminary bid for remaining of Sky Plc
10 December 2016
21st Century Fox, the US entertainment company controlled by Rupert Murdoch, yesterday struck a preliminary deal to buy the remaining 61 per cent it does not already own in British market-leading pay-TV provider Sky Plc, for around $14 billion (£11.25 billion), a 40-per cent premium to Sky's 6 December closing price.
The two companies said that they had reached a preliminary agreement for £10.75 per share in cash ($13.52) but that certain material offer terms remained under discussion. Fox has until 6 January to announce a firm intention to make an offer for Sky.
Fox already owns 39.1 per cent of Sky, and a successful deal would value the whole of Sky at about $23 billion.
This is the second attempt by Fox to buy the whole of Sky after its £7.8-billion offer in 2010 was derailed after it was revealed that two of his newspapers had hacked into the mobile phones of celebrities and politicians, leading to a major scandal.
This attempt was made by Rupert Murdoch's News Corp, which has since split into two distinct publicly traded companies, 21st Century Fox and the new News Corporation. (See: News Corp's board okays splitting news and entertainment businesses) A proposed transaction between the two would bring together 21st Century Fox's global content business with Sky's world-class direct-to-consumer capabilities, which have made it the number one premium pay-TV provider in all its markets.
A deal would give Fox full control of a pay-TV network spanning 22 million households in the UK, Ireland, Austria, Germany and Italy.
It would also enhance Sky's leading position in entertainment and sport, and reinforce the UK's standing as a top global hub for content generation and technological innovation.