Disney must offer to buy Sky if 21st Century deal goes through

Walt Disney will have to make a mandatory takeover offer for Sky within 28 days of the completion of its acquisition of 21st Century Fox's assets, if the rival Fox and Comcast bids fail, the UK Takeover Panel has ruled.

The panel said Disney must make an offer to Sky shareholders of £10.75 in cash for each of their shares if Fox's takeover of the 61% of Sky it doesn't already own is blocked by competition authorities.

"The basis for this ruling is that…the Executive considers that securing control of Sky might reasonably be considered to be a significant purpose of Disney’s acquiring control of Fox."

The Takeover Panel said Disney would not be forced to make an offer if Fox or Comcast - which announced in February that it was considering making an offer for the London-listed broadcaster - buys Sky, or if any other third party buys more than half of Sky's ordinary shares.

Sky noted the announcement by the panel on Thursday and advised its shareholders to take no further action.

"Further advice to Sky Shareholders will be announced in due course," it said.

Meanwhile, 21st Century Fox said it remains committed to its recommended cash offer for Sky, which is supported by revised remedies recently offered to the Competition and Markets Authority.

Olivetree Financial said: "In essence what this says is that if both Comcast and Fox's current bids for Sky fail - but Disney manages to acquire Fox, then Sky shareholders are backstopped by a mandatory bid at 1,075p (in 2019ish)."