The independent directors of pay-TV group Sky are now withdrawing their recommendation of a takeover bid from Rupert Murdoch's Fox after U.S. cable company Comcast challenged it with a £22bn ($30.68bn) offer.
Fox, which already owns 39 percent of Sky, offered to buy the rest of the shares in June, triggering concerns the deal would give Murdoch too much control over British media.
"We have long believed Sky is an outstanding company and a great fit with Comcast", Comcast CEO Brian Roberts said in a statement.
"Disney Chief Executive Officer Bob Iger, who called Sky a "crown jewel" when Disney announced its offer for Fox in December, now needs to decide how badly he wants to outdo Comcast for Sky and back a higher bid from Fox".
Comcast to compete with Rupert Murdoch's 21st Century Fox for pan-European broadcaster Sky.
In addition, Comcast says it will continue to support Sky's technology hub in Leeds, and "continue to support the creative industries in the United Kingdom and increase investment in United Kingdom film and TV production". "Until the relevant pre-conditions are satisfied, Sky shareholders are advised to take no action", Sky added.
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Comcast laid out a strategy that showed it was interested in being a good corporate citizen in Britain, promising to use Sky as a platform for growth in Europe, maintaining Skys U.K. headquarters and using the acquisition to expand its global footprint. That offer is reportedly 16% higher than what Fox had put forward, at £10.75 per share.
For its part, 21st Century Fox also issued a statement regarding the announcement on Wednesday, in which it maintained that the company is "committed to its recommended cash offer for Sky announced on 15th December 2016 and is now considering its options".
Now there is a better offer formally on the table, the board of Sky has duly retracted its recommendation to shareholders that they accept the Fox offer.
It partly reflected expectations among investors that Fox and Comcast - along with potential other suitors - were likely to enter a bidding war.
"When you see opportunities that won't come around again - unique opportunities - you have to consider that with extra focus", he said.
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