Sep 24, 2018

Sky opens new horizons for Comcast

Disney's offer surprised some involved, given that it was pitched below the market price of Sky shares: they had climbed to £15.85 in the weeks before the auction, largely on interest from hedge funds that had bet on Comcast and Disney-Fox bidding up the price. Missing out on the Sky bid means a windfall is coming Disney's way on the Sky stake it is getting as part of its $71bn purchase of Rupert Murdoch's entertainment assets - assuming that it decides to sell the stake, as seems likely. The Fox assets Disney is buying include a 39 per cent stake in Sky which, at the Comcast offer price, is now worth £11.8bn. "Disney will have to take as a consolation prize that Fox's position in Sky will end up worth much more than when Disney originally agreed to buy it," Mr Wieser wrote in a research note. What will Comcast do with Sky? It has a similar business model to Sky in that it owns both content and distribution. "Comcast will look at Sky and they will see a business that is vertically integrated like theirs they will understand the balance between content and distribution," said Mike Darcey, a former chief executive of Mr Murdoch's News UK and a former chief operating officer at Sky.

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