20th Dec 2016 14:21
LONDON (Alliance News) - Moody's Investors Service Tuesday affirmed its credit ratings for Sky PLC, and changed its outlook on the ratings to developing from stable in light of the recent formal takeover offer from 21st Century Fox Inc.
Moody's has affirmed its Baa2 senior unsecured and (P)Baa2 senior unsecured MTN ratings for Sky.
Fox last week tabled a recommended offer for the 60.9% stake of Sky it does not already own which valued Sky at GBP18.50 billion. Moody's said that it considers it likely there will be a lengthy regulatory review process for the takeover, potentially taking up to a year to conclude.
At this point, Moody's said it does not have visibility as to possible changes to the post-acquisition capital structure of Sky.
"Fox has stated that it will part-finance its proposed acquisition of Sky with close to GBP2 billion of cash on Sky's balance sheet. We consider this to be a potential risk to the current Baa2 rating but believe that Fox is likely to mitigate this risk through structural enhancements to the existing Sky notes, as would be consistent with its financial policy over many years," said Colin Vittery, Moody's lead analyst for Sky.
Shares in Sky were down 0.6% at 989.50 pence Tuesday.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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