Britain’s Takeover Panel has ruled that Disney must offer to buy all of Sky if it succeeds in its planned purchase of the majority of 21st Century Fox.
It means that even if Fox’s plans to take over Sky are blocked as a result of an investigation by competition regulators, Disney would still have to offer Sky’s shareholders a deal at the same price of 1075p per share.
The decision from the Takeover Panel, which applies City rules on takeovers and mergers under a code designed to ensure shareholders are treated fairly, disagreed with Disney’s argument that it should not have to do so.
The panel’s supervisory role is distinct from the investigation into the Fox-Sky deal being carried out by the Competition and Markets Authority (CMA), which looks at wider issues.
Fox, which already holds a 39.1% stake in Sky, agreed at the end of 2016 to buy the remainder of the company in a deal valuing it at £18.5bn.
The CMA provisionally ruled in January that the takeover “may be expected” to act against the public interest because it would concentrate too much influence over the UK media industry in the hands of the Murdoch Family Trust (MFT).
The trust – the vehicle through which Rupert Murdoch, the executive chairman of 21st Century Fox, owns a controlling stake in that company – also has a controlling stake in News Corporation, owner of The Sun, the UK’s top-selling national newspaper, as well as The Times, The Sunday Times and the Wall Street Journal.
However, the CMA has suggested remedies for Sky and Fox to address these issues.
Meanwhile, last year Disney agreed to buy Fox’s entertainment assets including its stake in Sky, in a separate deal which is also subject to regulatory clearance.
However, Disney argued that if Fox’s attempt to buy the remainder of Sky were to be blocked, it should not be forced under takeover rules to try to do so itself.
Thursday’s announcement by the Takeover Panel disagreed with that assessment. The panel said Disney, Fox and Sky had accepted the ruling.
It is the latest twist in a protracted saga which has also seen US broadcasting giant Comcast enter the fray.
Comcast, which owns America’s NBC network as well as the Universal film studio, revealed in February rival plans for a £22.1bn takeover of Sky.