Comcast Raises Its Offer For Sky To $34B, Continuing Battle With Fox

Comcast put forward its new proposal at an implied value of $34 billion, or £26 billion at £14.75 per share.

Fox issued a terse, one-sentence statement this evening acknowledging the Philadelphia-based company’s bid, which topped its own $32.5 billion offer earlier in the day.

Some interpret the Sky offer as as a signal that Comcast is walking away from its bidding war with Disney over Fox’s film and television assets and focusing instead on an asset that would

extend its reach in Europe.

Just a couple of hours before the latest offer came through, RBC Capital Markets analyst Steven Cahall issued a research report titled “The Final Countdown?” In it, he looked at the two

mega-deals in the final stages of bidding — Sky as well as the Fox assets.

“We could be seeing a bidding prioritization by Comcast for Sky over Fox, perhaps due to the fact that Comcast cannot afford both, and has to choose its battles,” Cahall wrote. “The market’s

collective wisdom appears to be pricing in a cool down in the bidding war for Fox with Disney and Comcast each rallying today, with Fox down 4%.”

The latest bid from Comcast is “doable” in terms of leverage, Cahall said. On a June 20 conference call with Wall Street analysts, Disney provided leverage projections both with and without

a successful Sky acquisition. “This has left some investors wondering if it indicates some willingness to back-off of a Sky bid,” Cahall wrote, especially given the company’s incremental

investment in its long-awaited direct-to-consumer service.