Disney must buy Sky UK if Fox's takeover fails rules competition authority
Apr 13 2018
The UK Takeover Panel on Thursday said Thursday that the Walt Disney Co will be required to make a mandatory offer for pay-TV operator Sky PLC at a fixed cash price of GBP10.75 per share after completing the proposed acquisition of Twenty-First Century Fox Inc.
Rupert Murdoch's Fox agreed an offer to buy all of Sky 17 months ago, but is still waiting approval.
Disney will be forced to acquire all of Sky if 21st Century Fox's takeover of the United Kingdom pay-TV broadcaster is not complete prior to the Mouse House's takeover of the rival Hollywood studio.
Disney had said it did not believe it should be required to make a bid for the whole of Sky in line with Fox's existing offer if it bought the Fox assets.
Fox now owns a 39% stake in Sky and is trying to buy the remaining stake 61%.
USA cable company Comcast said on 27 February that it was considering making an offer for Sky.
Sky said it "noted" today's announcement and urged shareholders to take no further action.
Fox proposed create a independent and separately run company for Sky News.
Fox's offer is under regulatory scrutiny of British regulators.
Sky shares were mostly unchanged at 1,311 pence in London on Thursday morning.
Hedge fund shareholders of Sky including Polygon Global Partners LLP had called for a mandatory bid for Sky by Disney at a higher price than the Fox offer.
"The commission has concerns that the companies involved may have violated European Union antitrust rules that prohibit cartels and restrictive business practices", the EU's executive branch said in a statement. In January, the United Kingdom competition watchdog ruled that the deal would be against public interest on media plurality grounds and would give too much control to the Murdoch family, which controls Fox.
However, in December Disney turned its attention to an alternative scenario should Murdoch's bid for Sky fail.