Comcast expects its rivals at Disney and Fox will force them to bump their bid, likely by billions of dollars, in the coming one-day auction for British satellite TV provider Sky, according to people familiar with the matter.
This weekend, Comcast and Fox (working in concert with Disney) will conclude their months-long battle to own Sky, with split ownership between Fox (and soon to be Disney) and public shareholders. The companies have gone back and forth several times with increased bids for Sky, but neither company has said its offer is "best and final." To put an end to the process, the U.K. takeover panel has made the rare decision to settle ownership with a three-round auction, which will take place this weekend, according to a U.K. takeover panel statement.
Comcast has currently made the highest bid for Sky, offering 14.75 pounds per share, or about $34 billion. Fox's offer stands at 14 pounds per share. Disney is already acquiring Fox's 39 percent stake in Sky, part of the company's $71.3 billion acquisition of many Fox assets earlier this year. Disney CEO Bob Iger has said several times he is interested in owning all of Sky.
Now, Comcast is assuming Fox/Disney will increase its bid for Sky whether or not it ends up buying the asset, said the people, who asked not to be named because the discussions are private.
The move would be a response to Comcast's actions earlier this year in the negotiations over Fox. Those competing bids pushed Disney's price to buy the majority of Fox nearly $20 billion higher, from an initial price of $52.4 billion to an end valuation of more than $71 billion, said the people.
Still, Comcast suspects Disney may have long ago concluded it's willing to give up on Sky, according to people familiar with the matter. Disney could also legitimately duke it out with Comcast to own the pay-TV distributor and owner of European content, including valuable live soccer rights.
Either way, Sky shareholders are expecting a new round of bids. Sky is trading at about 15.80 pounds a share, well above Comcast's most recent bid.