Morningstar

The Downside of Fox's Takeover of Sky

While Twenty-First Century Fox appears to be paying a reasonable price for Sky, we're not wowed by the potential acquisition of a satellite operator at a time when content distribution is increasingly moving online.

Sky announced on Dec. 9 that the company agreed in principle to a preliminary takeover bid from

Strategically, we see both positives and negatives associated with the deal. On the plus side, Sky is one of the leading pay television operators in Europe and produces a large amount of original programming. Further, Sky’s relationship with HBO could also potentially help Fox in the U.K. That said, we are not enamored with the potential acquisition of a satellite operator at a time when content distribution is increasingly moving online.

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About the Author

Neil Macker, CFA

Senior Equity Analyst
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Neil Macker, CFA, is a senior equity analyst for Morningstar Research Services LLC, a wholly owned subsidiary of Morningstar, Inc. He covers media/entertainment and video game publishers.

Before joining Morningstar in 2014, Macker was a senior equity research associate for FBR & Co., where he covered the telecommunications services sector. Previously, he was an associate equity analyst for R.W. Baird and completed the summer associate rotational program at UBS Investment Bank. Before attending business school, Macker held analytical roles at Corporate Executive Board and Nextel.

Macker holds a bachelor’s degree from Carleton College, where he graduated cum laude, and a master’s degree in business administration from The Wharton School of the University of Pennsylvania. He also holds the Chartered Financial Analyst® designation.

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