This just in….
Comcast, the US media group, says it has abandoned its interest in 21st Century Fox assets and will focus on a takeover of Sky.
Disney had a debt to equity ration of of just 0.31 in 2013. It has slowly risen to 0.55. The Fox deal will increase this into the mid 0.7s.
Investors will be reluctant to see Disney increase its debt ratio further by entering a bidding war for Sky where an increase of every £1 in Fox’s offer will likely see $1.5billion added to Disney’s debt.
As part of the Disney / Fox agreement, Fox require Disney’s permission to increase their offer further.
It’s also worth noting that the original Fox offer from 2016 was worth £11.7 billion. The current leading offer from Comcast for Sky sits at £34 billion (£14.75 per share). Industry speculators are hoping a bidding war will see this rise to £16-£17 range.
Disney has already seen its initial accepted offer of $52.4 billion for Fox rise to in excess of $71 billion. It is unclear how much further it will go in securing Sky, which Iger referred to as Fox’s “crown jewel.
