Comcast becomes majority shareholder of Sky

New York (AFP) – US cable giant Comcast on Tuesday said it was now the majority shareholder of pan-European  satellite TV company Sky after purchasing 21st Century Fox’s 39-percent holding in the group.

It follows a long-running and costly battle to take control of Sky, with Comcast coming out on top against Rupert Murdoch’s 21st Century Fox.

Comcast shares closed up 0.7 percent at $35.44, cutting the company’s losses on Wall Street since sealing the deal on September 22. Some analysts have criticized Comcast for overpaying.

The two US entertainment giants each wanted full control of Sky in the face of increasing pressure from Netflix and Amazon for viewers.

“We are pleased today to be the majority owner of Sky,” Comcast Chief Executive Brian Roberts said in a joint statement to the London Stock Exchange.

With the acquisition of Sky, Comcast captures the broadcaster’s live rights for English Premier League soccer.

“We are also fully committed to ensuring Sky News’ future, maintaining its editorial independence and preserving its strong track record for trusted, high quality, impartial news,” Roberts added in reference to the 24-hour rolling channel.

Comcast last month successfully bid £30.6 billion ($40.1 billion, 35 billion euros) for Sky, which has almost 23 million subscribers across Europe.

Fox’s highest offer was worth £27.6 billion, and the pair was separated in the end by a rare blind auction following a drawn-out bidding war.

Sky, which changed its name from BSkyB after agreeing in 2014 to buy Sky Italia and a majority holding in Sky Deutschland, will delist its shares from the London stock market on November 7.

– ‘Benefit of the doubt’ –

Comcast bought Sky also to win a foothold in Europe and end its sole dependence on the United States at a time when Americans are switching to online streaming.

Sky is meanwhile planning to show all of its content online, meaning customers will eventually be able to dismantle their satellite dishes.

Comcast’s victory has been received skeptically by analysts, although some have come around.

“We wish Comcast had not acquired Sky,” analysts with the New Street research firm wrote Friday in a note to investors. “We wish they had walked away” when it became clear Comcast would have to pay £30.6 billion ($40 billion) to beat a rival bid from Rupert Murdoch’s 21st Century Fox for a controlling stake in Sky.

But New Street said the deal could also permit Comcast to spend more efficiently on original content and to better monetize their sports content.

“We doubt this management team has ever faced greater opposition over a transaction,” it said. “They wouldn’t have taken this step lightly.”

“We ought to give them the benefit of doubt, at least at the outset.”