21st Century Fox and Sky announce takeover agreement

21st Century Fox announced that it had reached a preliminary agreement to acquire Sky last week

The 21st Century Fox board and the independent committee of European subscription TV platform have announced agreement on the terms of a recommended pre-conditional cash offer by 21st Century Fox for the fully diluted share capital of Sky which 21st Century Fox and its affiliates do not already own.

Under the terms of the acquisition, Sky shareholders will be entitled to receive for each Sky share £10.75 in cash. That price represents a premium of approximately 40% to the closing price of £7.69 per Sky share on December 6 2016, the last business day before the date on which an initial proposal was received from 21st Century Fox by Sky.

Last week, 21st Century Fox announced that it had reached a preliminary agreement to acquire the 61% in Sky it did not already own. The transaction would value Sky overall at about $31 billion.

The shares that 21st Century Fox does not own have a value of $20 billion.

Commenting on the deal 21st Century Fox said in a statement: “As the founding shareholder of Sky, we are proud to have participated in its growth and development. The strategic rationale for this combination is clear. It creates a global leader in content creation and distribution, enhances our sports and entertainment scale, and gives us unique and leading direct-to-consumer capabilities and technologies. It adds the strength of the Sky brand to our portfolio, including the Fox, National Geographic and Star brands.”

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