Advertisement

Comcast snaps up lion’s share of Sky

Duo: Matthew Goode and Teresa Palmer: Sky
Duo: Matthew Goode and Teresa Palmer: Sky

Comcast on Thursday revealed that it has grabbed more than 75% of Sky shares, allowing the US cable giant to kick-start in earnest its plan to take control of UK and European living rooms.

Last week the cable giant said its £30 billion deal for the broadcaster of A discovery of Witches (pictured) was on track as it had already had 30% of the stock. Today it revealed it has struck a deal to get the 39% of stock owned by Rupert Murdoch’s 21st Century Fox, ending any last doubts that the deal would go through. It also formally ends the Murdoch family’s association with a business they built from scratch.

City analysts said that moving to 75% means that Comcast is now certain to take its ownership of Sky past 90%. At that point other investors have no choice but to sell-up.

Their shares will, in effect, be cancelled and a cheque sent for the balance. Fox was paid £11.6 billion for its stake at £17.28 a share, a deal funded by one of the largest bond issues in takeover history.

That £21 billion bond deal means a bonanza for bankers at Bank of America, Wells Fargo, Credit Suisse and others.

There is now intense City speculation about whether Sky management will stay or go.

Comcast chief executive Brian Roberts has been open in his admiration for Sky chief executive Jeremy Darroch, who lands £50 million from the deal.

Robert has been in to talk to Sky staff and assured them they will be left to run the business. Roberts said: “We’ve said this to Jeremy and the rest of the Sky team … They will be able to act as an independent company but with the resources of a $150bn company behind them.”

Comcast, like losing bidder Disney, sees Sky as platform for growth across Europe. It owns NBC and is the largest cable operator in America.

Today’s announcement ends one of the lengthiest and most dramatic takeover battles the City has ever seen. The speed at which Comcast has moved since winning the auction means the deal is now likely to conclude sooner than expected.

It had previously said it hoped to get the deal done by the end of October.

Murdoch has made two public attempts to take control of Sky, the latest effort failing when Fox’s £15.67 a share bid was trumped by Comcast.

Fox, in turn, is being taken over by Disney for £55 billion.