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Comcast challenges Murdoch with a $ 31 billion offer to buy Sky



LONDON (Reuters) – Comcast Corp., the largest cable operator in the United States, offered $ 31 billion on Tuesday to buy Sky and challenged Rupert Murdoch's Fox and Bob Igers Walt Disney for the European pay-TV gem ,

Comcast, a $ 184 billion media giant owned by NBC and Universal Pictures, said it would offer £ 12.50 per share, much higher than Fox's agreed £ 10.75 per share. Sky's shares rose 18 percent.

Britain, with 23 million households across Europe and known for its technological innovation, has already agreed to be sold to Murdoch's 21st Century Fox, but the deal has been delayed by concerns over the influence of the media magnate in the UK ,

This has complicated a separate $ 52 billion Disney deal to buy Fox assets including Sky.

"Sky and Comcast are a perfect match: we are both leaders in content creation and distribution," said Comcast Chief Executive Officer Brian L. Roberts, 58. "We believe Sky is a great company."

The recent round of major deals is putting pressure on cable networks to lose customers to streaming services like Netflix Inc and Amazon.com Inc.

MEDIA RIVALRIES

Shares in Sky rose to £ 1

3.08 as investors hoped the subsequent buying competition would lead both sides to offer a higher price.

"The initial stock price reaction suggests that this story will continue, with Sky's prices jumping above the already elevated Comcast offering," said Richard Hunter, Interactive Investor's Head of Markets.

The proposed offer brings Comcast Roberts against Murdoch, the 86-year-old tycoon who helped launch Sky in the UK, and who's focused on finally getting Sky, having been with the company for the first time eight years ago had bid.

Roberts also prevails against Disney's Iger after Comcast tried to buy Disney for $ 54 billion in 2004.

Comcast said he had not talked with Sky about the proposal 90 minutes after the statement, Sky was not yet responding.

FILE PHOTO: The NBC and Comcast logo will be displayed on Rockefeller Plaza 30, formerly known as the GE Building, in Midtown Manhattan, New York on July 1, 2015. REUTERS / Brendan McDermid / File Photo

"We would like to own the entire Sky Group and we will seek to acquire more than 50 percent of Sky's stock," said Comcast CEO Roberts.

"Innovation is at the heart of what we do. Combining the two companies creates significant growth opportunities," he said.

ALL EYES ON SKY

Sky's chairman is Murdoch's son James, who is the CEO of 21st Century Fox, so Comcast must gain the support of independent shareholders for its better offer if it does not become hostile Offer.

Fox agreed to buy the 61 percent of Sky that he did not own in December 2016, but the takeover was repeatedly hampered by regulatory concerns that Murdoch controls too many media in the UK.

Some Sky shareholders have also begun to complain that the offer is too low. In December, hedge fund manager Crispin Odey argued that Sky was being sold too cheaply.

The UK's competition authority said in January that Murdoch's proposed acquisition should be blocked unless a way was found to prevent it from influencing the network's news operation, Sky News.

The Competition and Market Authority (CMA) said that the deal would give Murdoch too much influence and would therefore not be in the public interest.

Murdoch's news programs are seen, read or heard by nearly a third of the British and have a combined share of public news consumption that is significantly higher than any other news service, with the exception of the BBC and the commercial news channel ITN.

Last week, Fox made further concessions, promising to maintain and fund a completely independent news service from Sky for 10 years.

Comcast said it has minimal presence in the UK media market and does not see any problems of plurality over its proposal.

Comcast said Sky News was an "invaluable part of the British news landscape" and intended to maintain the existing brand and culture of Sky News, as well as its strong track record for high-quality, unbiased news and standards compliance broadcasting standards.

"Our strong market positions complement Sky's leadership position in Europe and strengthen our outstanding position in the US," said Roberts of Comcast.

coverage by Kate Holton and Michael Holden; Edited by Guy Faulconbridge and Keith Weir

Our Standards: The Thomson Reuters Trust Principles.

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