Comcast Proposes to Buy European Media Giant Sky for $31 Billion

Comcast on Tuesday proposed to buy the European pay-TV and media behemoth Sky for $31 billion in cash, seeking to undercut a long-standing bid by 21st Century Fox for the portion of the company it does not already own.

“We think Sky is an outstanding company,” said Brian L. Roberts, Chairman and CEO of Comcast Corporation, in a release issued in the early hours of Tuesday. “It has 23 million customers and leading positions in the UK, Italy, and Germany. Sky has been a consistent innovator in its use of technology to deliver a fantastic viewing experience and has a proud record of investment in news and programming.  It has great people and a very strong and capable management team.”

Comcast said it would offer 12.50 British pounds per share, equivalent to $31 billion, which it said was a 16 percent increase over an offer previously made by 21st Century Fox.

Fox, which already owns 39 percent stake in Sky, has bid about $16 billion for the remainder of the company. But Fox chieftain Rupert Murdoch’s bid has been blocked by British regulators, concerned about the mogul’s influence over Sky News among other issues.

Also Read: Comcast May Still Try to Top Disney's Bid for Fox, CNBC Says

To allay the regulators’ concern, Fox has offered to create an editorial board with a majority of independent directors, and that had been considered an acceptable path to government approval. Murdoch has continued to pursue the deal with the pay TV giant even as Fox has agreed to sell its movie and television assets to Disney.

Murdoch has long coveted full ownership of Sky, and especially of Sky News, a 24-hour news channel. On Tuesday, the company issued a statement declaring that it “remains committed” to completing the acquisition.

But Comcast stepped into the ring with an aggressive bid, seeking a foothold in Europe.

Also Read: Fox 'Disappointed' After British Regulator Says Sky Deal 'Not in the Public Interest'

“Comcast intends to use Sky as a platform for growth in Europe,” Roberts said. “We already have a strong presence in London through our NBCUniversal international operations, and we intend to maintain Sky’s U.K. headquarters.  Adding Sky to the Comcast family of businesses will increase our international revenues from 9 percent to 25 percent of Company revenues.”