Disney must make offer for Sky, UK Takeover Panel rules

Ruling settles speculation over whether Disney would have to bid

A Disney bid at £10.75 a share values all of Sky at £18.5 billion.

A Disney bid at £10.75 a share values all of Sky at £18.5 billion.


Walt Disney must make an offer for Sky if its $52.4 billion (€42.5 billion) purchase of most of 21st Century Fox succeeds, the UK Takeover Panel has ruled.

Disney would have to bid £10.75 per Sky share upon completing the acquisition of Fox assets, which include an existing 39 per cent in Sky, and if Fox or Comcast don’t first buy the European pay-TV company, according to a statement on Thursday from the panel. That’s the same price offered by billionaire Rupert Murdoch’s Fox to Sky shareholders in 2016 for the stake it doesn’t already hold.

The decision may disappoint some Sky shareholders expecting Disney to be forced into a higher mandatory offer. However, it also means they have a likely bidder for the business and a price floor should the Fox takeover be blocked by UK regulators and if Comcast doesn’t formalise its proposed £12.50 per share offer for Sky.

“It’s very good news,” said Crispin Odey, founder of hedge fund manager Odey Asset Management, which owns a 0.8 percent stake in Sky . “Disney have underpinned the £10.75 bid.”

The ruling settles months of speculation regarding whether Disney would have to make a direct bid for Sky after Disney’s December offer for the bulk of Fox’s media and entertainment assets. At the time, Disney said it didn’t think it should be forced into bidding for Sky.

The panel’s decision was based on a determination that securing control of Sky “might reasonably be considered to be a significant purpose of Disney’s acquiring control of Fox,” according to the statement.

A bid at £10.75 a share values all of Sky at £18.5 billion.

Sky shares were mostly unchanged at 1,311 pence in London on Thursday morning. In a statement, Sky advised shareholders to take no action on the Takeover Panel decision.

- Bloomberg