Murdoch’s 21st Century Fox ready to buy Europe’s Sky

Rupert Murdoch may get full control of European broadcaster Sky. Sky said that Murdoch’s entertainment conglomerate ‘21st Century Fox’ has reached a preliminary deal to buy the rest of Sky for 10.75 pounds (USD 13.60) per share, the equivalent of about 11.2 billion pounds (USD 14.1 billion). Fox already owns just over 39 percent of Sky, and the deal price values the entire broadcaster at 18.5 billion pounds.

Taking control of Sky would give 21st Century Fox, which owns cable networks Fox News, FX and the Fox broadcast channel and a major Hollywood film studio, a distributor in Europe. Sky plc has 22 million customers in the U.K., Ireland, Germany, Austria and Italy. It sells TV and internet service, has its own news operation and sports channels and makes some TV shows.

The pound’s 16 percent drop against the dollar since June, when Britain voted to leave the European Union, would have made the UK-based Sky cheaper to acquire. There has long been speculation that another takeover deal was coming from 21st Century Fox. Shares in Sky jumped 27 percent in London. However, Sky and 21st Century Fox both said in statements that they’re still talking about some terms and a definitive deal is still not certain.

A combination of 21st Century Fox and Sky would be the latest to bring together a maker of TV and movies and a distributor of it. Wireless carrier AT&T has proposed buying HBO, CNN, TBS and film studio owner Time Warner in the U.S. for USD 85.4 billion. Cable giant Comcast finished its takeover of NBC Universal in 2013.

Entertainment companies are under pressure to adapt to changing video habits as consumers increasingly ‘cut the cord’ on traditional TV and spend more time watching video on their phones.