The Stakes Just Got Higher in the 21st Century Fox v

Lawrence Kim
July 12, 2018

As Fox and Comcast duke it out over Sky, Comcast could be readying a new bid for Fox's entertainment assets.

Murdoch owns major British newspaper titles The Times and The Sun and critics say obtaining full control also of the rolling television channel Sky News would give him too much influence in the news business. Sky's shares closed at £15.01 on Tuesday, suggesting shareholders think the battle is not over.

Disney's proposed deal to acquire the 21st Century Fox assets has hit a substantial speed bump this week, as one of the Fox shareholders has filed a lawsuit in regards to the merger.

Murdoch's Fox said the performance of Sky since December 2016, including its renewal of the right to show English Premier League matches at a lower price than expected, justified its higher offer. The European pay-TV company has become a pawn in a wider contest between Comcast and Walt Disney (dis) for the bulk of Murdoch's media empire, as each seeks scale to take on streaming competitors like Netflix.

Fox said it had secured the agreement of the independent committee of Sky for the deal. If true, this would be in violation of security rules and may well block - or at the very least stall - Disney's acquisition of 20th Century Fox and its precious entertainment assets.

"Disney's internal forecasts now, on the basis of the cash flows they've published for Sky, would value it at 16 pounds", he said. Both Fox and Disney have scheduled special shareholder meetings for July 27 in NY to approve the cash-and-stock deal to sell $71 billion in Fox assets to Disney.

"Fox coming back in for Sky isn't a surprise in itself, but the fact the offer is slightly behind what some had anticipated brings another twist", said George Salmon, equity analyst at Hargreaves Lansdown.

Murdoch's company still faces significant regulatory battles in Britain, including the culture secretary's statement that Fox would have to sell Sky News to win government approval because of concerns about media plurality.

Other reports by Click Lancashire

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