21st Century Fox shares rise as it ups its bid for Sky to £24.5 billion

Fox shares closed higher Tuesday ahead of confirmation the US media business has issued an increased bid for the UK's Sky PLC.

21st Century Fox shares rise as it ups its bid for Sky to £24.5 billion

21st Century Fox shares ended higher in the US Tuesday, ahead of confirmation the US broadcaster had issued an increased bid for the remaining proportion of Sky that it doesn’t already own.

The higher bid – which is 12% above Comcast’s offer – comes as Murdoch’s firm is close to gaining UK regulatory approval for the deal.

Fox shares ended the US Tuesday session 0.42% in the green at $49.77. Sky shares, meanwhile, were trading 0.27% lower at £1,497.50.

Fox escalates bidding war for Sky

Fox has made its increased offer to buy the 61% of Sky it doesn’t already own ahead of the expected UK Government approval of the purchase, this week. The Culture Secretary said in June that certain conditions had to be met in order for the sale and purchase to receive regulatory approval.

The main outstanding point was the Sky News channel. The UK Government said that channel had to be able to continue as a UK-based news channel, without any input or interference from Murdoch. This detail has been addressed by Fox, with plans to sell the Sky news channel to Disney.

Just ahead of the expected regulatory approval, Fox has increased its bid for Sky from its original £10.75 per share bid. The new bid of £14 per share is also some 12% above Comcast’s £12.50 per share offer, made in April.

Analysts expect another round of bidding

Sky is considered to be a real prize for US media companies working to gain a firmer foothold in the UK and Europe. That’s due to the expansion success of firms like Netflix and Amazon.

And, while this latest offer is some 80% more than Sky shares were worth in 2016 when the deal was originally made, analysts are expecting there to be another round of bids from both Comcast and 21st Century Fox.

“As the founding shareholder of Sky, we have remained deeply committed to bringing these two organizations together to create a world-class business positioned to deliver the very best entertainment experiences well into the future,” Fox said while sharing the news of its increased offer.

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