LONDON — Comcast beat Rupert Murdoch’s 21st Century Fox in the battle for broadcaster Sky on Saturday after offering $40 billion in a dramatic auction to decide the fate of the pay-television group.
The U.S. cable giant bid 17.28 pounds a share for control of London-listed Sky, bettering a 15.67 pounds-a-share offer by Fox, Britain’s Takeover Panel said.
Buying Sky will make Philadelphia-based Comcast, which owns the NBC network and Universal Pictures, the world’s largest pay-TV operator with about 52 million customers.
Chairman and chief executive Brian Roberts has had his eye on Sky as a way to help counter declines in subscribers for traditional cable TV in its core U.S. market as viewers switch to video-on-demand services such as Netflix and Amazon.
“This is a great day for Comcast,” he said. “This acquisition will allow us to quickly, efficiently and meaningfully increase our customer base and expand internationally.”
Comcast’s offer thwarted Murdoch’s long-held ambition to win control of Sky, and is also a setback for U.S. entertainment giant Walt Disney, which probably would have been its ultimate owner.
Disney agreed to a separate $71 billion deal to buy most of Fox’s film and TV assets, including its existing 39 percent stake in Sky, in June and would have taken full ownership after a successful Fox takeover.
Comcast’s final offer was significantly higher than its bid of 14.75 pounds going into the auction, and compares with Sky’s closing price of 15.85 pounds on Friday.
Comcast thought it needed to deliver a knockout blow given that Fox’s existing stake in Sky gave it a chance of victory if it was a close second to Comcast, two sources said.
Comcast’s final offer — more than double Sky’s share price before Fox made its approach in December 2016 — quickly won the backing of Sky’s independent directors on Saturday.
“We are recommending it as it represents materially superior value,” said Martin Gilbert, chairman of Sky’s independent committee. “We are focused on drawing this process to a successful and swift close and therefore urge shareholders to accept the recommended Comcast offer.”
Fox declined to comment.
Comcast, which requires 50 percent plus one share of Sky’s equity to win control, said it was also seeking to buy Sky shares in the market.