Comcast chairman and CEO Brian Roberts may have gotten some inspiration for his company’s $31 billion unsolicited bid for British satellite TV company Sky from a London cab ride, but his chief content lieutenant told an industry audience Wednesday that the idea began to germinate long before that.
Roberts has said that a conversation with a London cabbie as he was traveling in the city late last year to recruit another executive caused him to look at the satellite giant in a new light. NBC Universal CEO Steve Burke, speaking at the Morgan Stanley Technology, Media & Telecom conference in San Francisco, said the idea began to take shape even prior to Comcast taking itself out of the running for 21st Century Fox assets in December -- it didn't receive the "level of engagement" necessary to make a serious offer.
The Walt Disney Co. eventually was picked to purchase those assets – the deal still needs regulatory approval – for $66.1 billion.
Fox, which owns 39% of Sky, has been trying to purchase the remaining 61% interest in the satellite company for more than a year, but has run afoul of British regulators. Comcast would prefer to buy 100% of the satellite company but said it would settle for a 50% plus one share interest, which would let Fox retain its 39% stake until it is transferred to Disney.
The Sky interest is thought to be an integral part of the Disney deal – Fox had hoped it would have wrapped up consolidation of the asset prior to closing with the programmer – and most analysts believe it would be unlikely that Disney would want to be a partner with Comcast in the asset.
“They [Fox] chose to go a different direction and we said, ‘You win some, you lose some,’ and we moved on,” Burke said. “The more we thought about Sky, the more we realized it was so similar to everything we built with Comcast NBCUniversal. It’s such a unique asset and an asset where you know 100% of the shares are likely to trade. If the Disney-Fox deal happens, it’s all going to Disney. If Disney-Fox doesn’t happen, then at some point Fox tries to buy the whole thing. We decided to go for it.”
Burke downplayed what he called the “famous cab ride” that seemingly inspired Roberts to make his bid, adding that Comcast was well aware of the satellite giant before that particular hackney trip.
“The reality is we have 1,500 employees in London and we study Sky, we study a lot of different multichannel operators around the world in detail,” Burke said. “I’ve been to Sky headquarters a couple of times in Osterley [in west London], we’ve been intimately familiar with their guide. We know a lot about the company and we’ve been following the company for a long, long time. This just became the time when it looked like there was an opportunity. We’ll see if it works out.”
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