MONTH-IN-BRIEF (Jun 2018)
International M&A
European Commission Unconditionally Clears Comcast’s Proposed Acquisition of Sky
By David R. Venturella
On June 15, 2018, the European Commission (the “Commission”) unconditionally cleared Comcast’s $31 billion bid for Sky plc (“Sky”). The proposed transaction would combine Sky, the leading pay-TV operator in certain parts of Europe, with Comcast Corporation (“Comcast”), owner of Universal Pictures and TV channels such as CNBC, Syfy and E!. The Commission found that Sky and Comcast are mainly active in different markets in Austria, Germany, Ireland, Italy, the UK and Spain and compete with each other only to a limited extent. Because Sky and Comcast are active at different levels of the market, the Commission focused on whether Comcast would be able to limit access by Sky’s competitors to its films and other TV content or to its TV channels; whether Sky would have the incentive to cease purchasing content from Comcast’s competitors; and whether Sky could prevent competing channels from accessing its platform. Based on its review, the Commission found that pay-TV distributors would continue to have access to content from Comcast’s competitors and that Sky would have little incentive to cease purchasing content from Comcast’s competitors. Further, the ability to shut out competing channels from accessing Sky’s platform was significantly mitigated by the regulatory landscape in the UK, Germany and Austria. Accordingly, the Commission concluded that the transaction would raise no competition concerns. Comcast’s bid to acquire Sky is a counter-bid to an offer by Twenty-First Century Fox, whose offer was also unconditionally cleared by the Commission in April.
