Sky PLC (LON:SKY) is one of the many FTSE 100 companies to be falling on the UK Benchmark index today, as the bidding war between Comcast and Walt Disney continues.
Alleged undervaluation sees Sky PLC fall
Hedgefund activists Elliott, Davidson Kempner and Farallon Capital argue Sky’s (LON:SKY) share price is undervalued by 7.2% and have submitted an appeal to the Takeover Appeal Board stating that the current valuation of £14.00 per share is an undervaluation of 7.2% with the real value being £15.01 per share.
As Reuters calculated, this would set Sky’s overall valuation at £26.4bn. The news seems to disconcerting to investors with Sky LON:SKY) currently sitting at 1,540.00, down 0.32 per cent as of BST 13:57.
Fox undervalue previously rejected by Takeover panel
20th Century Fox, which already owns a 39% stake in Sky Plc had previously valued the shares at £12.50, a value which was rejected by the takeover panel. The offer to purchase Sky Plc is a compulsory one for Disney, whose main interest is the purchase of Fox’s TV and film assets. The further rejection of the share valuation could see the deal fall through with both Disney and Comcast being given until 22nd September 2018 to withdraw.
With all parties yet to issue any comments on the latest value rejection, it remains to be seen how this deal will play out for Sky Plc, however, Ben Martin reporting for Reuters states that “If Sky’s future is not resolved by then, the Panel has the power to intervene and run a formal auction to bring the bidding war to an end.”