Brian Roberts said that Comcast encourages its execs to have an "entrepreneurial spirit."GETTY IMAGES
Comcast CEO Brian Roberts said that Sky will operate independently once Comcast completes its £30B ($39.4M) takeover of the British media company after winning "a drawn-out battle" against Disney and 21st Century Fox, according to Matthew Garrahan of the FINANCIAL TIMES. Comcast won an auction for Rupert Murdoch’s pay-TV group with an offer of £17.28 ($22.67) a share. The deal ends Murdoch's involvement with Sky almost 30 years after he created the satellite TV group that "came to be the main rival" of the U.K.'s dominant terrestrial TV players. Roberts said that Comcast encouraged its top execs to "act entrepreneurially." Sky CEO Jeremy Darroch is "expected to stay on following the acquisition." Roberts: "The consistent theme at Comcast has been letting leaders of our businesses make their own decisions, being decentralized and keeping an entrepreneurial spirit" (FT, 9/23).
BONUS CHECK: In London, Duke & Gosden reported Darroch, who has run Sky since '07, will receive £50M ($65.6M) in "various performance-related share schemes." That includes 775,800 Sky shares that Darroch already owns. The company runs a performance-based scheme for about 700 execs and managers, who are due to receive about 28 million shares when the takeover is completed (LONDON TIMES, 9/24).
GRABBING SHARES: In London, Christopher Williams reported Comcast is "scrambling" to buy Sky shares from hedge funds "as it races to convert its dramatic auction victory into control of the company." Investment bankers at Bank of America Merrill Lynch were conducting a "sweep" of hedge funds to build Comcast’s stake. Short-term investors have loaded up on Sky shares "as the battle for control of the company has escalated over the past two years," betting that the final price of a takeover would "comfortably beat" the £10.75 ($14.10)-per-share deal agreed with Fox in Dec. '16 (TELEGRAPH, 9/23).
PRICE JUMP: In London, LaToya Harding reported shares in Sky jumped 8.8% to £17.24 ($22.62) following Comcast's bid. Both Comcast and Fox are aiming to increase their reach in Europe, and were "battling for control of Sky's 23 million customers as they fight off intense competition from online rivals such as Amazon and Netflix." Interactive Investor analyst Rebecca O'Keeffe said that the newer "tech-savvy" rivals revolutionized the TV landscape, changing the way people engage with TV and internet content. O'Keeffe said, "Sky shareholders are popping the champagne after this weekend's bidding auction valued the company at eye-watering levels. The premium that is being offered by Comcast is indicative of how much pressure is on traditional media platforms" (TELEGRAPH, 9/24).
COMCAST SHARES: REUTERS' Paul Sandle reported concerns about the premium Comcast paid were reflected on the stock market in N.Y., where Comcast's shares lost more than 6%. Analysts at MoffettNathanson downgraded Comcast from "buy" to "neutral" and Oppenheimer downgraded from "outperform" to "perform." Fox shares, in contrast, were up 0.6% and Disney gained 1.7% (REUTERS, 9/24).
'SUPERIOR VALUE': BROADBAND TV NEWS' Julian Clover reported the independent committee established by Sky to examine the future ownership of the broadcaster said that it is in the "best interests" of shareholders to accept Comcast's offer. The Committee said that the U.S. firm's offer price of £17.28 represented an "excellent outcome for independent Sky shareholders." Independent Committee of Sky Chair Martin Gilbert said, "We are recommending it as it represents materially superior value" (BROADBAND TV NEWS, 9/24).
