The drawn-out battle for control of Sky Plc between 21st Century Fox Inc. and Comcast Corp. will reach a climax this Saturday in an one-day auction that will settle who's willing to pay the most for Europe's biggest satellite carrier.
Britain's Takeover Panel said that it was prepared to take the rare step of intervening in the battle for Sky by running an auction that lasts for a maximum of three rounds.
The development was announced by the Takeover Panel, which presides over City rules governing bids for United Kingdom firms, as the clock ticks down to its deadline for American suitors 21st Century Fox and Comcast (Swiss: CMCSA.SW - news) to make final offers for the UK-based home and mobile entertainment and communications company. Fox already owns 39% of Sky, which has extensive pay-TV operations in the U.K., Germany and Italy.
"Shareholders will be delighted at how this has all played out, having seen the share price double since just before the original offer was made by Twenty First Century Fox nearly two years ago", said Laith Khalaf, a senior analyst at Hargreaves Lansdown.
The U.K. broadcaster is now valued at £27 billion, which translates to more than $35 billion.
Before then, the last auction had been in January 2007 when, after an eight hour contest, Tata Steel of India triumphed against Brazilian firm CSN with a £6.2bn bid for Corus, the owner of British Steel.
Comcast's $34 billion bid has been the top offer so far.
An auction for Sky, which broadcasts to 23 million households across Europe, would the biggest ever deal in the United Kingdom to be decided by a panel-run auction.
It is rare for the Panel to run auctions in takeover situations, with Tata's victory in acquiring United Kingdom steelmaker Corus in 2008 one of just a few in the past decade.
The auction begins at 1600 GMT on Friday, Sept. 21.
Shareholders will have to vote on the final bids by October 11.
In the first round of the auction, the offeror with the lowest offer at the start of the process can may make a higher bid and the other suitor can do so in the next round. They will do so knowing what their rival has done in the previous round, a source close to the process said.
The Panel has not set any rules governing how Sky's independent directors should respond once the the auction is over.
Both bidders, and Sky, and have agreed to the auction process.