US cable giant Comcast’s £22.1bn takeover bid for Sky plc, the owner of Sky News, has been cleared unconditionally by the European Commission.
The decision removes the last regulatory hurdle that stood before Comcast as the bidding war for Europe’s largest pay-TV operator hots up.
Sky’s largest single shareholders, the US media giant 21st Century Fox, was last week given the go-ahead by the UK government to bid for Sky on the condition that it sells Sky News to another approved owner ahead of any takeover.
Fox is currently negotiating with officials from the Department for Culture, Media and Sport (DCMS) about the terms of such a sale, which is expected to be to Disney, which in a separate deal just before Christmas agreed to buy Fox’s entertainment assets including its shareholding in Sky.
Comcast said earlier this week that it would be prepared to buy those assets for $65bn in cash – compared with the $52bn all-share deal proposed by Disney.
Brian Roberts, the chairman and chief executive of Comcast, said he welcomed the European Commission’s decision.
“We are excited by the opportunities that a combination of Sky and Comcast will bring,” he said.
“As we have said from the outset, we will invest to grow and enhance Sky’s business and be a strong steward of its valuable brand.
“Sky is a great British business – with us, that’s the way it will always be.”
Image: Should that agreement be reached, Matt Hancock, the Culture Secretary, has said there will then be a public consultation
Fox’s offer for Sky has already been cleared by the European Commission and by all the individual country regulators in which Sky broadcasts, except the UK.
It has until Tuesday this week to agree terms with the DCMS over the sale of Sky News.
Should that agreement be reached, Matt Hancock, the Culture Secretary, has said there will then be a public consultation, lasting at least 15 days, on the proposed sale.
Potentially there could then be further rounds of consultation on the deal before, as expected, Mr Hancock gives Fox the green light.
Fox is widely expected in the City to improve the terms of its offer for Sky.
It currently owns 39.1% of the broadcaster and, in December 2016, offered to buy out remaining shareholders at 1075p-a-share in a deal valuing the whole of Sky at £18.5bn.
That offer lapsed when the deal was referred by Mr Hancock’s predecessor, Karen Bradley, to the Competition and Markets Authority.
Comcast’s current offer for Sky is pitched at 1250p-a-share.
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Sky shares were trading this afternoon down 5p at 1345p.
In a stock exchange announcement, Sky said: “The independent committee of Sky welcome’s today’s announcement by the European Commission of its decision to approve unconditionally Comcast’s proposed acquisition of Sky.”
Source: Sky