Comcast has submitted the higher bid for European pay TV giant Sky in a three-round auction showdown with 21st Century Fox, with an offer worth $22.60 per-share, or £17.28 per share, which values Sky at $38.8 billion, or £29.7 billion.
Comcast on Saturday as expected prevailed over Rupert Murdoch’s 21st Century Fox, which has Walt Disney as a de facto backer, in the battle for the European pay TV giant Sky following a dramatic one-day auction.
Fox/Disney offered a final $20.50, or £15.67 per-share offer.
Fox has long owned a 39 percent stake in the company, with both suitors not submitting final Sky bids or dropping out of the acquisition hunt by a Saturday, Sept. 22 deadline, triggering the auction.
When the gavel finally fell early evening London time, Comcast had won with its all-cash offer that allows the U.S. cable giant to expand across the Atlantic by acquiring Sky and its 23 million BSkyB subscribers, digital assets and streaming options.
“This is a great day for Comcast,” Comcast chairman and CEO Brian L. Roberts said in a statement, as he pointed to Sky offering the U.S. cable giant an international platform on which to grow.
“This acquisition will allow us to quickly, efficiently and meaningfully increase our customer base and expand internationally. We couldn’t be more excited by the opportunities in front of us. We now encourage Sky shareholders to accept our offer, which we look forward to completing before the end of October 2018,” Roberts added.
The blind auction format saw 21st Century Fox bid first, followed by Comcast. Both media giants then went head-to-head with final sealed offers.
When the bidding rounds were completed, the UK Takeover Panel, which oversees public takeover transactions in Britain, officially revealed Comcast as the winner of the rare auction with its topping per-share bid.
Sky shareholders now have two weeks to tender their shares to Comcast as they weigh the respective offers from Comcast and 21st Century Fox. In a statement following the auction, an independent directors committee for Sky plc urged shareholders to accept Comcast’s winning bid.
“As the price of the final Comcast offer is materially superior, it is in the best interests of all Sky shareholders to accept the Comcast offer. Accordingly, the independent committee unanimously recommends that Sky shareholders accept the Comcast offer, and in order to ensure the successful closing of the Comcast offer, urges shareholders to accept immediately,” the pay TV giant said.
21st Century Fox in a short statement said it “is considering its options regarding its own 39 percent shareholding in Sky” after it was outbid by Comcast for the European pay TV giant. “Sky is a remarkable story and we are proud to have played such a significant role in building the incredible value reflected today in Comcast’s offer,” the studio added.
Comcast this summer sweetened its offer for Sky to £26 billion ($34 billion), or £14.75 per share, following news from Fox that it had raised its offer to £24.5 billion ($32.5 billion), or £14 per share.
Comcast has touted its play for Sky as a bid to expand the company’s international reach and revenue abroad, beyond the maturing U.S. market. Sky operates in the U.K., Ireland, Italy, Germany and Austria, plus has a new over-the-top service in Spain.
Jeremy Darroch, group chief executive at Sky, in his own statement said he was “looking forward to bringing our two companies together for the benefit of our customers and colleagues. As part of a broader Comcast, we believe we will be able to continue to grow and strengthen our position as Europe’s leading direct to consumer media company.”
Comcast’s winning bid for Sky also comes as global streaming services like Netflix and Amazon Prime are challenging traditional cable and satellite TV players.
The European Union in mid-June cleared Comcast’s bid after the U.K. government said it would not require a closer review by regulators. The U.K. government on July 12 gave its final clearance for Fox’s Sky bid under conditions that had mostly been detailed previously.
In early August, Fox published its formal offer document for Sky shareholders, but kept its takeover bid at a price below the offer from Comcast. The move gave Fox and Disney more time, making Sept. 22 the deadline for both suitors to raise their Sky bids.
Comcast in July bowed out of a showdown with Walt Disney for a large chunk of 21st Century Fox, including its current 39 percent Sky stake. Disney won the bidding war with an offer of $71.3 billion. Comcast said it would instead concentrate on Sky.
“Within the constraints of the U.K. Takeover Code, horse trading over Sky between Fox/Disney and Comcast could obliquely prod action in other areas, including whether Comcast sells its 30 percent Hulu position to Disney now that the latter will imminently have 60 percent ownership post the Fox deal close,” Buckingham Research Group analyst Matthew Harrigan said in a recent report. “Action around Hulu could also involve Comcast-owned NBCUniversal’s attitude toward providing programming on a long-term basis to Hulu.”
This article originally appeared on The Hollywood Reporter.