BskyB offer for Sky Deutschland rejected by major shareholder
30 Jul 2014
Crispin Odey, the former son-in-law of Rupert Murdoch, has rejected BskyB's offer to acquire the of shares of Sky Deutschland, The Telegraph reported.
BskyB announced an agreement last week to pay up to £7.4 billion to acquire Sky Deutschland and Sky Italia from Rupert Murdoch's 21st Century Fox (BSkyB acquires Fox's pay-TV assets in Germany and Italy for $9 bn).
The plans would see Fox sell its controlling 57-per cent stake in Sky Deutschland to BSkyB for £2.9 billion.
BSkyB said it would offer the same price of €6.75 a share to minority investors, valuing them at £2.1 billion.
However, this price has been rejected by Odey, one of the UK's most successful fund managers, who said that Odey Asset Management LLP did not intend to tender the shares in this proposed offer.
The fund manager is Sky Deutschland's second biggest shareholder, after 21st Century Fox, with a stake of around 8 per cent.
Odey, with his prior experience as an activist investor, had been agitating for a higher price since May when BSKYB confirmed that it was looking at a takeover of both Sky Deutschland and Sky Italia for the creation of a European pay-TV giant (BSkyB in talks to merge 21st Century Fox Pay-TV assets in Germany and Italy).
However, a stock exchange statement that came four days ago from the satellite broadcaster reiterated its position, ''Odey Asset Management LLP continues to believe that the current proposal, effectively a nil premium takeover offer to the minority shareholders of Sky Deutschland AG, significantly understates the value of the company''.
According to Odey, the offer valued its stake at a ''nil premium'' and therefore it would not be selling up to BSkyB.
Odey had expressed reservations about the BSkyB's plans to create a pan-European pay-TV giant in May saying, he believed the deal was not sweet enough, The Guardian reported.
According to BSkyB it did not need full control of Sky Deutschland for it to be able to benefit from its plan to create Sky Europe.
After acquiring majority stake in the German business, BSkyB would exercise control over decision-making by being able to select who sat on the supervisory board.