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Sky shares rally after Comcast wins bidding war

25 September 2018

The rare auction was organized by Britain's Takeover Panel after months of offers and counteroffers from Comcast and 21st Century Fox as the US media companies sought a foothold in Europe. Robey Warshaw, Evercore, Bank of America Corp. and Wells Fargo & Co. were to split up to 37.8 million pounds for their work on behalf of the US cable operator, according to that same proposal.

Comcast has offered $39 billion for Sky and has started buying up shares in an effort to acquire more than 50 percent of the stock to cement control.

The Sky logo is seen on outside of an entrance to offices and studios in west London, Britain June 29, 2017.

The Takeover Panel, the body that regulates United Kingdom mergers and acquisitions, had mandated the two companies to enter an auction process to conclude a final bid in the long-drawn saga to take control of Sky.

The American media giant, which owns the NBC network and Universal Pictures, outgunned Rupert Murdoch's 21st Century Fox in an auction for the television operator.

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"We consider the Comcast Offer to be an excellent outcome for Sky shareholders, and we are recommending it as it represents materially superior value", said Martin Gilbert, Chairman of the Independent Committee of Sky.

Comcast believed it needed to deliver a knockout blow given that Fox's existing stake in Sky gave it a chance of victory if it was a close second to Comcast, two sources said.

Sky's shares were trading at 17.27 pounds in early deals on Tuesday.

If Comcast doesn't get those Sky shares and just ends up with a 61 percent stake in the broadcaster, its debt level would still be $100 billion, Sarma said.

Sky shares rally after Comcast wins bidding war