Activist investor Chris Hohn sent a letter this week to 21st Century Fox Chairman Rupert Murdoch and the company’s board, urging the company not to turn away so fast from Comcast’s bid to purchase its entertainment assets.
“We do not know if Comcast will return with a higher offer, but we will be strongly motivated by the deal that offers the highest price and we will encourage other shareholders to do the same,” Hohn wrote in his letter, which was first reported on by Financial Times.
Hohn heads TCI Fund Management Ltd., which is one of Fox’s largest shareholders, controlling a 7.4% stake in the company. His letter was prompted by an SEC filing made by Fox earlier this week, in which the media company justified taking a $71.3 billion cash and stock offer from The Walt Disney Company.
In the filing, Fox indicated misgivings about Comcast’s ability to get a Fox purchase past U.S. regulators.
Hohn disagreed with Fox’s position, noting that a federal court’s decision to allow AT&T to purchase Time Warner Inc. earlier this month “is unequivocally positive for issues of vertical integration of content with a pay TV platform.”
He added that “the largely international nature of the assets being sold by Fox and Comcast’s willingness to match structural remedies, means that the overall antitrust risk is low.”
Hohn further asserted that Comcast’s ownership of NBCUniversal shouldn’t pose a regulatory issue, and the Justice Departments antitrust sign-off on Disney’s rival bid for Fox also “sets a strong precedent and a template for a Comcast settlement.”
Fox has not commented on Hohn’s letter.
Fox agreed to Disney’s $52 billion all-stock purchase offer in December. Earlier this month, Comcast tenured a $65 billion all-cash counter-offer, with Disney successfully counterbidding at $71.3 billion in cash and stock.
All eyes are now on Comcast for a response.