Bidding war for Sky looms as Comcast offers £22bn

US cable operator Comcast (Swiss: CMCSA.SW - news) has made a formal £22bn bid for Sky (Frankfurt: 893517 - news) , the owner of Sky News, in a move likely to stoke a bidding war for the UK company.

Comcast, whose interests include the NBC TV network and the Universal Pictures movie studio, followed through on interest it registered back in February with an offer of £12.50 per share on Wednesday morning.

The value of its bid put it ahead of the proposed deal Sky had with 21st Century Fox, which wants to clinch the 61% of Sky that it does not already own but is being held up by regulatory clearances.

The current Fox offer puts an £18.5bn price tag on Sky.

:: The Fox takeover plans for Sky explained

Comcast said its offer was 16% higher than Fox's valuation.

Sky responded by saying it was withdrawing its recommendation of the Fox deal - paving the way for bids to be raised.

Fox responded to Comcast's bid by saying it was considering its options and a further announcement would be made in due course.

Comcast said its bid came with a series of legally-binding commitments on Sky ownership and UK investment.

It included a 10-year commitment to Sky News - its future proving one of the sticking points of the Fox bid which is still being considered by regulators over concerns it would hand the Murdoch Family Trust too much influence over UK media.

Comcast said it was in talks with Sky's Independent Committee "with a view to obtaining a future recommendation of the acquisition".

The US firm's chairman and chief executive, Brian Roberts, said of the Sky bid: "With (Other OTC: WWTH - news) its 23 million retail customers, leading positions in the UK, Italy, and Germany, and its history of strong financial performance, we see significant opportunities for growth by combining our businesses."

He added: "We also understand the role that Sky plays in UK society and in its customers' lives and we are determined to be responsible and trusted owners of Sky."

Its share price rose by over 4% following the announcement to £13.61 - significantly above the £12.50 per share offer by Comcast.

It reflected expectations among investors that Fox and Comcast - along with potential other suitors - were likely to enter a bidding war.