Bloomberg

21st Century Fox Inc. agreed to acquire Sky Plc for 11.7 billion pounds ($14.6 billion), in Rupert Murdoch’s second run at Europe’s dominant pay-TV company, as the media billionaire seeks to consolidate his television empire across two continents.

Fox, which already holds a 39 percent stake in London-based Sky, will pay 10.75 pounds a share for the rest, according to a statement. That represents a premium of 36 percent over Sky’s closing price on Dec. 8, the day before the companies disclosed a preliminary offer. Murdoch is returning after a previous bid was thwarted in 2011 over a phone-hacking scandal at his newspapers.

The deal gives Fox a distribution platform to complement its film studio and cable channels like FX and National Geographic. Sky provides satellite-TV service to 21.8 million customers across the U.K., Ireland, Italy, Germany and Austria, and has been adding exclusive entertainment and original content to its core sports offerings while expanding into broadband and mobile service.

The purchase “creates a global leader in content creation and distribution, enhances our sports and entertainment scale, and gives us unique and leading direct-to-consumer capabilities and technologies,” Fox said in the statement.

Fox pledged to keep Sky’s headquarters in London and complete a 1 billion-pound investment in the campus. The company also said it expects Sky News to maintain “its excellent record of compliance with the Ofcom Broadcasting Code.”

For Murdoch, the timing of the deal is right: Momentum behind U.S. stocks continues to build as traders bet that President-elect Donald Trump will follow through on promises to cut regulations and reduce taxes, helping to drive earnings growth. In the U.K., the pound has weakened against the dollar after the Brexit vote, which makes the acquisition cheaper for New York-based Fox.

Murdoch’s Sky bid follows AT&T Inc.’s $85.4 billion deal earlier in 2016 to acquire Time Warner Inc., owner of HBO, CNN and Warner Bros., as traditional media push for scale to combat online video services like Netflix and Amazon Prime. Both deals would establish new beachheads for the companies, combining the delivery of content with the content itself.

Sky shares have traded below the offer price, first disclosed on Dec. 9, as investors weigh regulatory and political risks to the deal. The U.K. government can ask media regulator Ofcom to check whether the merger might harm plurality in the country’s media.

However, Murdoch may be counting on changes to the media landscape and U.K. politics to clear the way. Unlike when Murdoch’s News Corp. bid for Sky in 2010, Fox doesn’t own any U.K. newspapers and the rise of digital outlets may also work in the bid’s favor, as people rely less on TV, radio and print publications to get their news.

Prime Minister Theresa May has been eager to promote investment in the U.K. in the wake of the Brexit vote. Still, critics of the deal are airing their grievances. Any takeover agreement should be delayed until after second phase of inquiry into press malpractice, Former Prime Minister Gordon Brown wrote to U.K. Culture Minister Karen Bradley, the Guardian reported.

Fox may need to address resistance from some Sky shareholders pushing a bigger payout than the preliminary offer, which matches a price Sky’s shares reached in February. The stock had slumped in 2016 amid concerns about the rising cost of sports rights, competition from digital rivals such as Netflix Inc. and skepticism about Sky’s ability to deliver double-digit revenue growth in Germany.

While consolidating Sky is expected to save Fox in areas like taxes, some analysts have questioned the deal’s strategic value.

“We scratch our heads in terms of what a distribution company headquartered in the U.K. does for a global content company headquartered in the U.S. over the long term,” Wells Fargo analysts led by Marci Ryvicker wrote in a research note. “We’re not buyin’ it.”

Sky has been seeking to stave off competition from phone and cable companies, in part by securing rights to exclusive programming such as HBO shows, and spending on original dramas like “Fortitude.” The company has paid record sums to air Premier League matches and keep ahead of BT Group Plc, which also broadcasts some of the league’s games.

To diversify further, Sky has has expanded into broadband, and it’s starting a mobile phone service, an attempt to crack a 15.2 billion-pound market in the U.K.

Murdoch has long made clear his desire to own all of Sky. He was derailed in his 2010 attempt to buy out other shareholders for 7.8 billion pounds, after revelations that two of his newspapers hacked into the mobile phones of celebrities and politicians.

Fox’s latest approach has spurred fresh complaints over corporate governance at Sky, where Murdoch’s son James returned as chairman this year. James Murdoch, 44, leads Fox as chief executive officer and was Sky’s CEO from 2003 to 2007.

“It would have been preferable to have an independent chairman,” Piers Hillier, chief investment officer at Royal London, a Sky shareholder, said in a Dec. 12 statement. The creation of an independent board committee to evaluate the bid “addresses some of the conflicts of interest, however it doesn’t go far enough.”

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