Comcast has announced a formal takeover offer for UK broadcaster Sky at GBP 12.50 in cash per share, valuing the company at GBP 22 billion (USD 31 billion), in line with its preliminary approach in February. This represents a 16 percent premium to the offer from 21st Century Fox. As a result, Sky is withdrawing its recommendation of the Fox offer and terminating their co-operation agreement.
The cancellation of the co-operation agreement means that Fox is no longer obliged to pay a break fee of GBP 200 million. To finance the deal, Comcast has entered into an unsecured bridge credit agreement of up to GBP 16 billion (USD 22 billion) and an unsecured term loan of up to GBP 7 billion (USD 10 billion). The acquisition is subject to a number of pre-conditions and conditions, including securing all anti-trust and regulatory approvals.
As part of the offer, Comcast has agreed to maintain annual expenditure in Sky News for at least 10 years, establish an editorial Sky News board to ensure editorial independence, maintain Sky's UK headquarters in Osterley for five years, and not to acquire any majority stakes in UK newspapers for five years. With a customer base of around 52 million across Europe, Comcast said that Sky would be its platform for growth across Europe and allow it to invest more in original and acquired programming.
