Hedge fund Polygon Global Partners, which is an investor in Sky (LON:SKY), argues that the outcome of the English Premier League rights auction supports its view that the takeover by Twenty-First Century Fox undervalues the FTSE 100 group, Reuter reports. The news came after it emerged that Sky and BT Group (LON:BT.A) would pay less for the majority of live games.
Sky’s share price rose in the previous session following news of the auction, climbing 1.98 percent to close at 1,082.00p. The shares outperformed the broader UK market, with the benchmark FTSE 100 index gaining 45.96 points to close 0.64 percent higher at 7,213.97. The group’s shares have added just under 10 percent to their value over the past year, as compared with a 0.75-percent dip in the Footsie.
Polygon comments on Fox offer
Nicolas Dautigny, a senior portfolio manager at Polygon, said in a statement to Reuters yesterday that from the time of Fox’s offer for Sky, the fund had recognised that the group “was worth far more than offered”.
“Yesterday’s news reinforces our view,” he added. Rupert Murdoch’s Twenty-First Century Fox is currently trying to acquire the UK pay-TV provider, and recently pledged to keep Sky News independent as it looks to assuage competition concerns.
Hargreaves Lansdown upbeat on Sky
Hargreaves Lansdown meanwhile reckons that the FTSE 100 group may be able to up the price Fox will have to pay for the company. Citywire quoted the broker’s analyst George Salmon as explaining that Sky was ‘the big winner’ in the Premier League auction, securing more games at a lower cost, which makes the company an even more attractive prospect.
“All this means Sky looks much healthier than when Rupert Murdoch’s Fox first bid for the business,” the analyst pointed out.