UK Takeover panel sets Disney/Sky conditions

Hedge fund shareholders of Sky including Polygon Global Partners LLP had called for a mandatory bid for Sky by Disney at a higher price than the Fox offer

UK Takeover panel sets Disney/Sky conditions

If Comcast ends up acquiring Sky, Disney would not have to put forward a bid, the Takeover Panel said.

Comcast Corporation, which announced on February 27th that it was considering making an offer for Sky, or any other third party, has acquired more than 50 per cent of the ordinary shares of Sky.

The Takeover Panel also ruled that Disney would have to match Fox's £10.75 (Dh56.03) a share offer for the Sky stocks, which is the same offered by Fox for the company stocks which it doesn't already hold.

The U.K. Takeover Panel said Thursday that Walt Disney will be obliged to make a mandatory offer for Sky if its proposed acquisition of assets from 21st Century Fox proceeds.

The UK regulator said Disney would have to make a fixed GBP10.75 per share cash offer for Sky, the same price offered by Fox. "Each of Disney, Fox and Sky has accepted these rulings", it added.

Forcing Disney to offer the same price as Fox did in 2016 is likely to disappoint some Sky shareholders who were hoping for a higher bid.

Sky PLC (BSY.L, SKY.L) stated that its shareholders are advised to take no further action with regard to the announcement by the UK Panel on Takeovers and Mergers.

Analysts had said Disney wanted a special dispensation to give it more flexibility in terms of whether or when it would bid for the rest of Sky if it only bought the 39 per cent stake from Fox. Earlier in the month, the company proposed two remedies to address plurality concerns voiced by United Kingdom mergers regulator the Competition & Markets Authority.

In the meantime, Comcast is still in the mix with a competing $31 billion bid for Sky after missing out on the deal for Fox's entertainment assets that went to Disney.

Fox said that it believes its deal for Sky will close by June 30 2018 and is confident that the UK's Competition and Markets Authority will approve the transaction so it will be interesting to see which mega-deal moves first.

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