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Fox sniffs out a bargain with Sky bid

The pay-TV broadcaster and 21st Century Fox have agreed a possible takeover deal
Fox sniffs out a bargain with Sky bid

Five years on from its last attempt, the Murdoch family has mounted another bid to take control of Sky (SKY). Twenty-First Century Fox (US:FOXA), which owns 39.1 per cent of the pay-TV broadcaster, has tabled a possible cash offer of 1,075p a share that values the company at nearly £18.5bn. James Murdoch, son of media tycoon and Fox co-chairman Rupert Murdoch, is Fox's chief executive and Sky's chairman. The offer, which represents a premium of 36 per cent to Sky's share price just before news of the deal broke, has won preliminary approval from Sky's independent directors. But it could leave investors wanting more.

IC TIP: Hold at 997p

News Corp tabled a £7.8bn bid for Sky in 2011, two years before Rupert Murdoch split the company into Fox, which houses its film and television businesses, and News Corp (US:NWSA), home to The Sun, The Times and other publications. However, the media titan backed away following the revelation that journalists at its News of the World newspaper hacked the mobile phone of murdered schoolgirl Milly Dowler - the political and public backlash against the Murdoch family made the deal unworkable. James Murdoch resigned as chairman of Sky - then BSkyB - in April 2012, but stepped back into the role earlier this year, reigniting speculation of a Fox buyout.

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