U.S. media giant Comcast offered Wednesday to buy British broadcaster Sky Plc for 22 billion pounds ($30 billion), topping a controversial bid from Rupert Murdoch’s 21st Century Fox.
The move opened up the possibility of a bidding war for Sky, whose stock spiked 4.4 percent to 13.63 pounds on the news of the offer. Sky immediately withdrew its recommendation to its shareholders to accept the Fox bid.
Sky is based in London but has strong news and pay-TV operations across Europe, and is particularly prized for its sports broadcasting operations, including the English Premier League soccer matches.
“With its 23 million retail customers, leading positions in the U.K., Italy, and Germany, and its history of strong financial performance, we see significant opportunities for growth by combining our businesses,” said Brian Roberts, Comcast’s CEO.
Roberts said his company’s cash offer values each Sky share at 12.50 pounds, 16 percent higher than the 21st?Century Fox offer of 10.75 pounds.
Critically, he pledged to address the regulatory concerns that stalled the Fox offer. Britain’s competition regulator is conducting an investigation into whether Fox’s bid for Sky would give Murdoch and his family — who already own several other media titles in the U.K. — too much control over the country’s news media.
Comcast pledged to maintain funding levels for Sky News for a decade and to safeguard its editorial independence.
“We also understand the role that Sky plays in U.K. society and in its customers’ lives and we are determined to be responsible and trusted owners of Sky,” Roberts said.
Fox, controlled by Rupert Murdoch’s family, has faced hurdles in trying to buy the 61 percent of Sky it doesn’t already own. Murdoch withdrew a previous bid for Sky in 2012 amid fallout from the phone-hacking scandal, in which journalists gained illegal access to the voicemails of celebrities. Those revelations rocked Murdoch’s British newspaper arm and led him to close the 168-year-old News of the World.
21st?Century Fox issued a statement saying it remains committed to its offer and is “currently considering its options.”
The firm had also offered to insulate Sky’s news operations from the influence of Murdoch and his family to win approval of its bid.