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Sky shares rally after Comcast and Fox go head-to-head in bid battle

Reuters  |  LONDON 

(Reuters) - Shares in jumped higher on Thursday after submitted a $34 billion bid for the group just hours after raised his offer, escalating a trans-Atlantic bidding war for the European pan-TV group.

Comcast, the world's biggest group, said it had secured the backing of Sky's independent directors for a 14.75 pounds per share offer that came just 16 hours after Murdoch's had offered 14 pounds.

The speed with which Comcast's returned with a higher offer was designed to show how determined he is to buy the group which is present in 23 million homes across

A person familiar with the situation said believed the deal would still be accretive to its cash flow in the first year of completion at the new price it had offered.

Sky's shares were up 3 percent at 15.38 pounds on Thursday, valuing it at 26.6 billion pounds, or $35 billion, as investors bet the battle has further to run for a group which owns a slate of top sport and original drama content.

"Investors are now close to doubling their money as a result of the bidding war for Sky, and there may yet be another twist in this tale which will swell their coffers even more," Laith Khalaf, a at said.

Sky's shares have risen 95 percent since Fox made its first bid in 2016, and have risen 55 percent in the last year.

The fight for Britain's leading pay-TV group is part of a bigger battle being waged in the industry as the world's spend tens of billions of dollars to take on the rapid growth of and

and are locked in a separate $70 billion-plus battle to buy most of Fox's assets, which would include Sky, and Disney is backing Murdoch in his pursuit of the British company.

The stand off pits the industry's biggest names against each other, with Roberts, the Murdoch family and Disney's engaged in a multi-billion dollar game of chess to reshape the global business.

The three are at a tech conference in Sun Valley,

Analysts are divided as to who will emerge triumphant.

at said Comcast may succeed in winning but lose out on Fox to Disney.

at BTIG said however he thought Disney needed to buy to secure a direct relationship with customers in so it could sell them its vast range of programming.

Murdoch helped to launch Sky in 1989 in Britain, building it up to be Britain's dominant pay-TV provider through its ownership of soccer, U.S. drama and films. It now offers in Ireland, Austria, and Germany, and in

($1 = 0.7571 pounds)

(Reporting by Kate Holton, Editing by Paul Sandle)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

First Published: Thu, July 12 2018. 13:38 IST
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