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| Rupert Murdoch confirms £11.7bn Sky bid | Rupert Murdoch confirms £11.7bn Sky bid |
| (35 minutes later) | |
| Rupert Murdoch’s 21st Century Fox has formally lodged its £11.7bn bid to take full control of Sky, as he looks to seal a deal to create the most powerful media group in the UK. | Rupert Murdoch’s 21st Century Fox has formally lodged its £11.7bn bid to take full control of Sky, as he looks to seal a deal to create the most powerful media group in the UK. |
| Murdoch will now need to gain regulatory approval for the deal, which values Sky at more than £18bn, which will give him control of pay-TV operations in the UK, Germany and Italy; in addition to ownership of the Times, Sunday Times and Sun, and radio group TalkSport. | Murdoch will now need to gain regulatory approval for the deal, which values Sky at more than £18bn, which will give him control of pay-TV operations in the UK, Germany and Italy; in addition to ownership of the Times, Sunday Times and Sun, and radio group TalkSport. |
| Fox has not raised the initial £10.75 per share offer it tabled on Friday. | Fox has not raised the initial £10.75 per share offer it tabled on Friday. |
| Karen Bradley, the culture secretary, now has 10 working days to decide whether the deal raises public interest concerns, specifically relating to media plurality. | Karen Bradley, the culture secretary, now has 10 working days to decide whether the deal raises public interest concerns, specifically relating to media plurality. |
| Bradley is likely to ask regulator Ofcom to launch an investigation, to see whether Murdoch will have too much control over news media in the UK. | Bradley is likely to ask regulator Ofcom to launch an investigation, to see whether Murdoch will have too much control over news media in the UK. |
| Murdoch controls Sky and assets including Fox News and film studios through 21st Century Fox, and newspaper and publishing assets such as the Times and Sun through a separate company, News Corp. | Murdoch controls Sky and assets including Fox News and film studios through 21st Century Fox, and newspaper and publishing assets such as the Times and Sun through a separate company, News Corp. |
| Ofcom will have up to 40 working days to file its public interest report on the deal, assuming Bradley asks the media regulator to investigate. | Ofcom will have up to 40 working days to file its public interest report on the deal, assuming Bradley asks the media regulator to investigate. |
| “We are excited to bring Sky fully into 21st Century Fox,” said 21st Century Fox executive chairman Lachlan Murdoch. “Partial ownership of Sky was not natural end state for us. Fully combining the businesses is a clear logical next step of protfolio evolution. It adds the strength of the Sky brand to our portfolio including Fox, National Geographic and Star brands. Considering the complete set of options in respect of capital allocation this transaction provides most attractive returns of for 21st Century Fox shareholders.” | |
| Fox has said that if the deal is not done by the end of next year it will pay shareholders a sweetener of a 10p special dividend. However, Fox has said shareholders will not receive any dividend payments next year. | |
| Previously, Sky’s 10.75p per share offer was due to be reduced by taking off shareholder dividend payments next year. | |
| Fox has said that if the deal falls through it will pay a £200m break free. In 2011, News Corporation paid a break free of about £38.5m after pulling out of its bid as the phone-hacking scandal engulfed Murdoch’s UK newspapers. | |
| A number of shareholders including Standard Life, Jupiter and Royal London Asset Management have said Fox is getting the pay-TV company on the cheap, arguing that Sky’s shares were at the offer level as recently as February. | |
| Sky deputy director Martin Gilbert, who led an independent committee that evaluated the value of Fox’s offer for non-Murdoch shareholders, said that there was unanimous agreement for the deal. | |
| If the deal does stretch into 2018, which Fox has said it does not expect, it will guarantee dividends to all shareholders but with a cap of 21.8p per share for the year ending June 2018. |