UPDATED with Fox statement: Five years after the UK hacking scandal forced then-20th Century Fox to scrap a deal to acquire Sky, it looks like a sale will happen after all. Sky said today that it has reached an agreement with Rupert Murdoch’s 21st Century Fox on an offer price for £10.75 per share in cash ($13.52), or around $15 billion.


Sky adds, though, that “certain material offer terms remain under discussion and there can be no certainty that an offer will be made by 21st Century Fox, nor as to the terms of any such offer.”

Fox said in a statement that by January 6 it must “announce a firm intention to make an offer for Sky…or announce that it does not intend to make an offer.” It added that Sky’s independent directors have “indicated”  they are willing to recommend the offer.

Fox’s says a deal “would bring together 21st Century Fox’s global content business with Sky’s world-class direct-to-consumer capabilities, which have made it the number one premium pay-TV provider in all its markets. It would also enhance Sky’s leading position in entertainment and sport, and reinforce the U.K.’s standing as a top global hub for content generation and technological innovation.”

Fox shares initially spiked on the news but quickly dropped, and are down 2.5% in afternoon trading.

Analysts have been waiting for Fox to make a move. CEO James Murdoch hinted at an investor conference this week that one was likely saying that ”a 39% holding is not natural for us.”

The company could see about $100 million in cost savings and synergies, requiring it to raise about $17

Rupert Murdoch Brexit
Associated Press

billion in debt, RBC Capital Markets’ Steven Cahall estimates. Investors should warm to the deal, he figures, because Fox holders already know and like Sky.

“Counter-bids are unlikely given [Fox] already owns 39% of shares,” he adds. The 15% drop in the value of the pound vs the U.S. dollar following the Brexit vote in June “was likely a key consideration.”

Stifel Research’s Benjamin Mogil likes the fact that Sky would “continue to diversify [Fox] away from U.S. cable advertising” which is threatened by cord cutting and shaving. He also believes the transaction will contribute to Fox’s earnings.

Murdoch created Sky in the late 1980s. He quickly lost control when he merged the company with BSB, creating BSkyB. He tried to buy it in 2010 but was forced to scuttle his plans when his company came under intense scrutiny during the News of the World phone-hacking scandal.