Sky has previously said it aimed to double its dividend by 2026.
Today, Bowman said there was now a “clear path” to delivering on that promise.
Sky said it received an updated offer, but it fell well short of what the board thinks the company is worth.
Others in strife
Chief executive Sophie Moloney said there had been 7 million Rugby World Cup streams across Sky Go and Sky Sport Now.
Bowman highlighted others’ strife, noting the demise of Spark Sport, and saying that “on the global stage, the rush to streaming has resulted in a sea of over US$9 billion in red ink”.
He added, “The local state-owned broadcaster, TVNZ, is also facing uncertainty given the failed merger with RNZ, changes in leadership, and a likely change in mission under a new Government. We have long been of the view that local players in our small market have more to gain from working in partnership with each other, particularly where we can deliver great local sport and entertainment to New Zealanders in ways that work for them, and we will continue to advocate for this approach.”
Bowman underlined that while Sky could potentially lose exclusivity to some content in the future - he used HBO’s Max as an example - the change would be reflected in what Sky paid for rights. Sky looked forward to “robust but constructive negotiations” with the new leadership of NZ Rugby’s commercial arm.
Mystery buyer snubbed
Earlier, in an NZX filing, Sky offered more colour on its decision to snub the mystery buyer.
“Yesterday, Sky received an updated NBIO [non-binding investment offer] from the third party (which remained highly conditional and non-binding), proposing a transaction at a value range which falls short of the board’s view of the fair intrinsic value of Sky and, based on recent unsolicited feedback, the view of a number of Sky’s institutional shareholders,” the firm said in a statement.
Before the market opened on October 13 , Sky said it had received a “highly conditional, non-binding preliminary expression of interest” to acquire all of its shares.
The deal created a degree of buzz, with the Australian speculating Atairos - a US private equity fund backed by Comcast - or NZ Rugby investors Silver Lake could be in the frame.
But both firms denied interest when contacted by the Herald.
Some analysts said Sky, which recently reinstated its dividend and topped one million customers as streaming gains finally started to outpace the decline in its satellite business, was an attractive takeover target.
But others saw indicators it was a low-ball, opportunistic offer.
Hamilton Hindin Greene investment adviser Jeremy Sullivan told the Herald it was notable that Sky included its disclosure about the approach as part of a routine update centring on its share buyback programme.
“What that tells me is that Sky, whilst obliged to disclose it, does not feel that it has the legs to go through,” Sullivan said on October 13.
Sky said with the offer now off the table, it will resume its share buyback offer.
Shares, which were trading at $2.47 before the offer, closed yesterday at 2.84.
Chris Keall is an Auckland-based member of the Herald’s business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.
