Under British takeover rules, Rupert Murdoch’s Fox now has until Sept. 22 to trump Comcast’s 14.75 pound per share offer for Sky, which values the broadcaster 25.9 billion pounds, after it formalised its own 14 pounds per share bid.
Comcast gatecrashed Fox’s attempt to buy the 61 percent of Sky that it does not already own earlier this year and the U.S. cable giant’s latest, higher offer, which it submitted in July, has been recommended to shareholders by the broadcaster’s independent directors.
Fox posted its formal offer document, without improving its price, on Tuesday, setting in motion a timetable to end the uncertainty over Sky’s future by triggering a 46-day period during which both Fox and Comcast can lift their offers.
If the situation is not resolved by then, Britain’s Takeover Panel can run an auction to bring the complex and long-winded transatlantic takeover battle for Sky to an end.
However, Fox may opt to walk away from the Sky deal rather than taking on Comcast, people familiar with the matter said.
Sky shares were up 1 percent at 15.355 pounds on Wednesday, signalling that investors expect the bidding war to continue.
In the document, Fox said it was switching from a scheme of arrangement to an offer. That means it can choose to lower its acceptance threshold from 75 percent of Sky’s minority shareholders to a simple majority of all the broadcaster’s shares, including its own 39 percent stake.
“Flipping to an offer affords Fox more flexibility should they wish to come back with a higher number,” analysts at Olivetree Financial said. “A scheme is cumbersome as you would constantly need to co-ordinate your actions and intentions with the Sky board.”
Fox also said it expects to pay its advisers, which include Deutsche Bank, Goldman Sachs and Centerview Partners, about 242 million pounds if its Sky bid succeeds.
Since submitting its first 10.75 pound per share bid for Sky in December 2016, Fox has agreed to sell the bulk of its TV and film assets, including its Sky stake, to Walt Disney (DIS.N).
Comcast had been vying with Disney for the Fox assets but last month dropped its pursuit to focus on buying Sky.
In a separate announcement, Sky acknowledged Fox’s offer document and said its independent committee would respond to the offer within 14 days.
The Takeover Panel, which regulates merger and acquisitions in Britain, ruled earlier this year that Disney would have to make an offer for the rest of Sky if its deal for the Fox assets completes before either Comcast or Fox acquire the UK broadcaster.
The regulator said last month that the level of any mandatory Disney offer should be 14 pounds a share, the same price as Fox’s current offer.
But the Takeover Appeal Board, an independent body, said on Wednesday that “several interested parties” had lodged appeals against the ruling and that it would meet to consider their petitions.
Reporting by Shashwat Awasthi in Bengaluru, Carl O'Donnell in New York and Ben Martin in London; additional reporting by Kate Holton in London; editing by Alexander Smith