Sky seeks to calm shareholder concerns over Fox bid as board independence comes under fire
Broadcasting giant Sky is vying to convince investors that 21st Century Fox’s £10.75 per share takeover bid is not undervaluing the company.
Sky revealed last Friday it had reached an agreement with Fox that values the business at £18.5bn – but some shareholders criticised the approach over the weekend.
One big name City shareholder told City PM that the price was “clearly” too low.
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“The fact that the board have accepted such a low offer comprises their independence and competence,” said the fund manager, who did not wish to be named. A major shareholder told Reuters that it would vote against the takeover bid as the offer was too low.
Politicians have also spoke out against the deal, though it would appear media analysts don't expect the regulator to have a problem with the tie-up.
Sky believes the premium of 36 per cent on Thursday’s closing share price was a good offer, but investors were quick to point out the broadcaster’s share price was above that as recently as February this year.
Last week Sky rejected a lower priced offer from Fox before securing an improved offer following two days of talks between the companies.
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No formal offer has at the time of writing been received by Sky.
Fox already owns nearly two-fifths of Sky, and its chief executive James Murdoch was earlier this year reappointed as Sky’s chairman.