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Gabriel Brown
Gabriel Brown
9/24/2018 | 3:41:55 PM
SKY pay-off
It might also be a play on the weak pound versus strong dollar. Potentially when UK politics normalizes again (ha!) and the pound recovers a more natural level (ha!) this deal could look 20 percent less expensive. This obviously isn't something you can bank on, but it does offer a possible upside. 

Having said that, the main point -- that SKY is a rare asset -- is the stronger reason for the acquisition.
bosco_pcs
bosco_pcs
9/24/2018 | 5:46:49 PM
Probably not but it won't kill Comcast either
Comcast had no choice. 

IMO, Comcast wanted to rain on Disney's parade by forcing the latter to pay more for Fox. Subsequently, it realized it might be in a weak position since there are fewer content assets out there, especially in Europe. Realizing it is boxed in, it goes all in with Sky.

Iger has already positioned Disney suggesting it doesn't need Hulu to thrive in OTT. It has BAM tech and ESPN skinny already after all. My guess is that it and Comcast are going to swap partial ownership of Sky (after Disney-Fox merger) and Hulu.

So, perhaps Disney has the last laugh.

But don't cry for the Robertses. First, the family has de facto control of Comcast. Second, even if it overpays Sky and the latter is a declining asset, it gives Comcast a foothold in Europe. Busting out of America is a long term play. More importantly, Comcast has enough cashflow to give it some cushion. It may stop buying back shares for a while but it shouldn't have problem keeping outside shaerholders happy with dividend.

Heck, if the stock keeps falling, it could be attractive value-wise. 


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