Disney to Sell SkyTV Shares to Comcast for $15 Billion

In what could be the final chapter in the long running bidding war between Comcast and 21st Century Fox, last week, Comcast quietly bought the UK’s SkyTV for $39 billion. But that didn’t include the 39% stake that came with Disney’s acquisition of 21st Century Fox. Now, the House of Mouse has managed to get back the extra amount it was forced to pay for Fox with a deal that sells their shares of SkyTV to Comcast for $15 billion. Couldn’t we have avoided all this mess?

“Along with the net proceeds from the divestiture of the RSNs, the sale of Fox’s Sky holdings will substantially reduce the cost of our overall acquisition and allow us to aggressively invest in building and creating high-quality content for our direct-to-consumer platforms to meet the growing demands of viewers,” Robert A. Iger, Chairman and Chief Executive Officer, The Walt Disney Company

When Disney announced their deal to purchase 21st Century Fox for $52 billion, it wasn’t long before Comcast offered a higher bid, forcing the Mouse House to ultimately pony up $81 billion, including taking on $13 billion in Fox debt, in order to seal the deal. Ultimately, Comcast backed off, choosing to focus on getting SkyTV, which we said was their ultimate goal.

Already, Comcast and Fox had been in a battle to gain the remaining shares of the British TV network, and now that Disney has signed off on the deal to tender their 39% stake in the network for $22.75 a share, the overall benefit to Disney is $15 billion, which will clear out the Fox debt and enable Disney to put a down payment on that sizable $70.4 billion acquisition for Fox.

Disney also has to proceed with divesting itself of the Fox Sports Regional Network, as a condition of receiving FCC approval for the sale. “The transaction, coupled with the divestiture of the Fox Sports Regional Networks, will significantly reduce the amount of debt Disney will incur in acquiring 21st Century Fox, and enable Disney to maintain its strong balance sheet as it continues to invest in content creation for its direct-to-consumer platforms,” Disney said in a statement.

“With 21CF announcing its intention to sell its shares to Comcast we close one chapter while simultaneously opening another,” said Jeremy Darroch, Sky Group’s CEO in a statement. “Our aim is to make the next 30 years as exciting for customers, colleagues and all our stakeholders.”

For the immediate future, there will be no real change on the part of SkyTV viewers. Plans are that SkyTV will continue to operate independently of Comcast.  The deal has yet to receive formal acceptance by SkyTV shareholders, but the British broadcaster has signaled their recommendation to do so immediately.

I gotta say, in this high stakes game of brinksmanship on Wall Street, I have to say advantage Disney. The company may ultimately pay the same, or less for the studio , than Comcast will pay for taking over SkyTV. When you consider that includes a majority share of the Hulu streaming network, and the entire Fox Studios catalog (including Star Wars Episode IV and the Fox Marvel Universe). That’s some good work for the Mickster.

About James DeRuvo 801 Articles
Editor in Chief at doddleNEWS. James has been a writer and editor at doddleNEWS for nearly a decade. As a producer/director/writer James won a Telly Award in 2005 for his Short Film "Searching for Inspiration. James is a recovering talk show producer from KABC in Los Angeles, and a weekly guest on the Digital Production Buzz with Larry Jordan.

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