Sky Live Discussion

Hopeful Investor 01 Mar 2018

Re: Netflix on Sky Q ... told you so too! All adds to the appeal for those who wish to acquire the company.

cimbom 01 Mar 2018

Netflix on Sky Q ... told you so too! Today we have announced a new partnership to bundle the full Netflix service into a brand-new Sky TV subscription pack. This pioneering partnership will give millions of Sky customers seamless access to Netflix through the Sky Q platform.We will make the extensive Netflix service available to new and existing customers by creating a brand-new and attractively priced entertainment TV pack, combining Sky and Netflix content side by side for the first time.With the Netflix app integrated into Sky Q, and Netflix programmes promoted alongside Sky content, customers can enjoy shows such as Britannia, Billions and Big Little Lies alongside The Crown, Stranger Things and Black Mirror, as well as free to air TV, all on the Sky platform. At the same time, customer will enjoy the simplicity of one monthly bill and easy to use integrated user interface.As part of the new partnership, Sky customers will be able to seamlessly access Netflix content in the Sky Q menu, plus quickly find their favourite Netflix programmes including the use of Sky Q’s search and voice search functionality. Existing Netflix customers will be able to easily migrate their account to the new Sky TV bundle, or sign into the Netflix app using their existing account details, to enjoy Netflix with even greater convenience.Jeremy Darroch, Group CEO, told today@sky:“The exciting new features coming to Sky Q will enable Sky customers to access even more of the best entertainment delivered over the best product platform. placing Sky and Netflix content side-by-side, along with programmes from the likes of HBO, Showtime, Fox and Disney, we are making the entertainment experience even easier and simpler for our customers. Our recent announcements mean we will extend our leadership in delivering customers the best viewing and user experience in Europe.”This European partnership will see Netflix - along with the new Sky TV pack - launch on Sky Q in the UK and Ireland in the coming year. Netflix will launch on Sky Q platforms in Germany, Austria and Italy thereafter.The agreement with Netflix also extends to Sky’s contract free streaming services. In the UK and Ireland, Sky will launch Netflix as a standalone app on NOW TV’s family of streaming devices including on the NOW TV Smart Stick which was recently launched in the UK. Sky Ticket in Germany and Austria, and NOW TV in Italy, will launch a standalone app on their devices in due course.

Self made hedge operator 27 Feb 2018

Re: Comcast - reading between the lines Commentary by Square Global Markets SKY/ FOX/ COMCAST - IMPLICATIONS OF COMCAST POSSIBLE OFFER (SQUARE)2018-02-27 175:33.900 GMTWe think important to clarify / re-iterate a few technical points which mayeducate deal dynamics here:* Fox cannot withdraw its £10.75 bid for the fully diluted share capital ofSky which it does not already own, * More importantly, Fox cannot tender its 39% stake in Sky to Comcast unlessagreed by both: 1. The UK Takeover Panel, per rule 4.2 of the UK Takeover Code –“Restrictions on dealings by the Offeror and Concert Parties”; 2. Disney itself, per point 2.a) Transfer Restrictions of the VotingAgreement -Exhibit 10.1 of the Fox / DIS Merger Agreement* Fox needs the approval of Disney to counter the Comcast offer given Fox isrequired to seek the approval of Disney to incur any additionalindebtedness above $400m – per Fox/Dis Merger Agreement Article V,“Covenants” b), iv)* DIS buying in the market to block Comcast Offer is not a plausiblescenario: 1. It would contradict the case they made to the Takeover Panel of themnot having to launch a mandatory given buying Sky shares at thisstage would likely fall under “significant purpose” (per note 8 ofR9.1 of the Code) 2. Also, under rule 9.5, this mandatory offer would need to be in cashand at the highest price paid by the offeror for Sky shares in the 12months before the offer was announcedIn light of the above, it is fair to say that DIS is now effectively incontrol of what will happen with the Sky / Fox scheme in terms of price level* The cleanest way for DIS to completely “block” Comcast would be to allowFox to pay up substantially* Ideally they also manage to gather ~10%+ irrevocables which wouldensure Comcast then does not reach its 50%+ acceptances* In a potential bid war scenario, gathering irrevocables couldprove extremely tricky – at best they would be “soft with acollar” – i.e. fall away in case of higher Comcast offer of x%We think if DIS decides they need 100% of Sky, they may have to pay up in the£14s* They are facing a Comcast with sizeable firepower - though it wouldalready reach a 3.0x PF leverage, adding - say - half a turn gives them anadditional envelope of c.$15bn cash to deploySafe to say Comcast does not seem to be in for the 100% of Sky, nor can theyreally count on it* This takeover offer is a defensive move engineered to force some kind ofdistribution / content agreement partnership with Disney once they are amajority owner of Sky* Michael J. Cavanagh (CFO) during Investor Call Q&A argued he had nopreference between majority and 100% ownershipIf DIS decides it is not financially viable anymore for them to pay up for the100% control of Sky, they have two options: 1. No improvement to scheme offer price – Fox Scheme voted down but DIS stillends up owning 39% in Sky upon completion of Fox deal 2. No improvement to scheme but - with the Panel blessing - DIS lets Foxmonetise the 39% Sky stake with £12.50 Comcast Takeover Offer* This would lead to, in a way, a cleaner ownership structure for theGroupThe above all boils down to the relative players’ strategic objectives whichno outsider can really put a price tag onSky Independent Board Recommendation is still uncertain* On paper, absent any counter offer from Fox, Sky Independent Board wouldlikely change their recommendation for the Comcast offer which alsocarries less execution risk from a regulatory standpoint* However, the weak point in the Comcast offer is the deliverability byway of acceptance threshold* Even as low as 50%+1, it could prove tricky if you count out theMurdoch stake and the tracker funds* Note: once the Takeover Offer is launched, Comcast would be able to buy inthe market – and these would count toward acceptances* Note: a change of Sky Board recommendation would lead to termination

Self made hedge operator 27 Feb 2018

Re: Comcast - reading between the lines True - but it is a greater hurdle to get an effective controlling stake starting from a 39% base than Comcast's zero.Also, I think that y the end it, there will be a 5% at least difference between the final offers by each company. The directors will need there to be a clear difference between the bids to enable them to recommend one over the other, not just tuppence a share.IMHO, of cours

Hopeful Investor 27 Feb 2018

Re: Comcast - reading between the lines I would tend to agree except that Comcast are only asking for 50% plus one share. So the 39% doesn't officially come into the equation.

Self made hedge operator 27 Feb 2018

Re: Comcast - reading between the lines I would say b.Fox have the advantage in them already having the 39% shareholding. I presume they are taking now to Disney about how the extra cash is financed and then they just flip it to them.It will have to be an improved offer because the current independent directors (am not sure about the validity of that term as they have been happy to take the shilling for so long) can't justify the current £10.75.Option d I would put at less than 0.1%. Stranger things have happened but the genie is out of the bottle.

Hopeful Investor 27 Feb 2018

Re: Comcast - reading between the lines so, in your (or anybody else who may wish to comment) opinion, do you:a) see Comcast as the owner at the initial price or one higher than mentioned?b) see Fox as the owner with an improved offer?c) see Disney entering the fray with a direct offer themselves?d) Nothing changing?

Self made hedge operator 27 Feb 2018

Comcast - reading between the lines The releases Comcast have made indicate that this is just the first offer.First of all - they stress that this is a 'superior offer' or to put it another way.'Independent directors conduct a proper auction or you will be sued'.Second - they mention that the price they are bidding would lead to an improvement in Comcast's free cash flow per share in year one. What kind of bidder says that? One who knows they will have to pay more.This opening gambit is basically to freeze the momentum towards sky and i fully expect a further iteration from Comcast and Fox/Disney.I thought the bid was undervalued and that the premier league action added 100p to Sky's value. Is well worth the hold with a downside of £12.50.

cimbom 27 Feb 2018

Re: 9/12/2016 - Told you so Pyueck, I was primarily pointing out the price in February 2016 @ £11 and the manner it got suppressed to ~£9.00 (not sure exactly what it was on the day of the bid) through the purchase of SKY Germany and Italy. Hence the markets valued SKY @ £11 the same year irrespective of what you or I think.We have always had differences of opinion but the company was no different to that on Feb 2016, hence undervalued @ £10.75, that is the point.

pyueck 27 Feb 2018

Re: 9/12/2016 - Told you so Cimbom, while I have already eaten my humble pie. I should say that I never said the deal will not go through or that another bidder wouldn't come in. I said that in my eyes, especially with the huge risk of the PL rights £10.75 was a fair price and one that shouldn't be sniffed at. I was, am still am bearish on Sky's long term proposition, but fully appreciate that the latest PL rights deal was a very positive one for Sky.Yes events have gone Sky's way, the PL rights was an excellent result for Sky and as per my note at the time I think Fox was cheeky thinking that they could get the benefit of this without paying more, as if the PL rights was lost I strongly believe Fox/Disney would have walked.The P/E ratio is now approaching 34, so I cannot really fathom why anybody could argue that the new bid is undervalued. However I have no idea what Disney, Fox or Comcast will do next and I wouldn't rule out a bidding war.

El Kel 27 Feb 2018

Re: I'm out I suspect Fox will be spitting feathers ---------- pyueck - I certainly hope so!The cosy little deal was way undervalued imo.

Windsor Buffet 27 Feb 2018

Re: Re: Not really, the 10p 'special dividend' is about one third of what would have been paid during 2017 and even the Murdoch's wouldn't try to get away with indefinitely suspending dividend payments. It's not as black as I painted it but history shows a couple of attempts to get full control of Sky at pretty average prices.

cimbom 27 Feb 2018

Re: 9/12/2016 - Told you so I read questions being raised belatedly about Fox selling Sky Germany and Italia and subsequently buying them back through SKY deal. That was one of the actions Fox/BSkyB directors took to suppress Sky share price creating a big debt in Euros, particularly post Brexit, appearing like an increasing liability. Of course once share price was suppressed, £10.75 looked like an attractive offer to some!

cimbom 27 Feb 2018

9/12/2016 - Told you so I think this what appears to be an "agreed bid" looks like a con to boost share price perhaps to aid Sky's creditworthiness. Fair price is at least £14. Sky is producing a lot of cash, hugely profitable, very successful in dramas, retained all important PL, now likely to make positive impact to customer retention with Sky mobile. NOW TV is making huge contribution and expanding in many countries, with Sky Q a huge success, Sky broadband well positioned to take over first spot from BT...most important of all businesses being tuned around in Germany and also in Italy; future is bright.£10.75 is a con! I would vote against! ......the way, as we all know this bid did not happen overnight, therefore pre-bid price is actually ~ £11; price of shares at the beginning of 2016! One way or another manipulation of directors if there is any and FOX would be exposed unless they pay the fair price for the company! The deal at £10.75 is dead!

Hopeful Investor 27 Feb 2018

Re: Re: You have forgotten that in addition to the 10p dividend paid for the deal not being completed by the 31st December 2017, a further 13p per share is due shortly becuase of the increased value in the company following the half yea