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Is Rupert Murdoch Vs. Hedge Fund Greed in the sky

Just give us more. The Sky Plc auction has become a show of greed. On Wednesday, Twenty-First Century Fox Inc. made a new offer of 14 pounds per share, valuing the British satellite station at 25 billion pounds ($ 33 ​​billion).

But the hedge funds had seen coming, and they had sent Sky's shares are above that level at the end of last month. Sky bidders look like a modern Tantalus, condemned to grab fruit permanently out of reach.

15 is the new 14

Not long ago, an offer for Sky at 14 pounds per share would have been a record price.

Source: Bloomberg

Sky's independent directors recommended the last offer despite not reaching the current price of approximately 15 pounds. In the absence of an acquisition battle, the shares would likely trade between 9 pounds and 10 pounds. It is difficult to see how the issuer could, by itself, obtain the actions at the level of supply in the foreseeable future.

In addition, the last offer raises the floor below the shares. Previously, the 12.50-pound offer from Comcast Corp. had provided some support.

Remember that the battle for Sky is part of a much larger war between Comcast and Walt Disney Co. over the control of Fox's entertainment assets. A risk to the shareholders of the British company was that all three came to an end. agreement to split Fox and Sky between them, leaving the Comcast offer the best on the table.

But Sky's board does not deserve all the credit. The new offer may be seen as the result of the revised agreement that Disney approved last month to buy most of Fox, including its 39 percent stake in Sky.

This should trigger a separate offer of Disney by Sky according to UK acquisition rules designed to prevent them from taking control of the British company through the back door. Disney and Fox, who are partners, are moving forward.


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