BSkyB rebuffed by Sky Deutschland

BSkyB today suffered a blow when its offer to buy out the independent shareholders in Sky Deutschland was dismissed as too low, although it should not derail the British firm’s plan to create a European pay-TV giant.

Sky Deutschland’s board, which represents the independent shareholders, said BSkyB’s €6.75-a-share offer “does not reflect the full potential and thus intrinsic value of Sky Deutschland’s business”.

Those close to BSkyB said they would still be able to press ahead with its £5.35 billion merger of Sky Deutschland and Sky Italia.

Rupert Murdoch’s 21st Century Fox, which owns 57% of Sky Deutschland and 100% of Sky Italia, has already agreed to sell its stakes to BSkyB as part of a rearranging of the media mogul’s TV interests.

BSkyB said when it launched its bid in July that it did not need to buy all of Sky Deutschland and it maintains that 57% control will be sufficient.

Observers said the decision by Sky Deutschland’s minority shareholders to reject the offer did not come as a surprise.

However, BSkyB was obliged to make an offer to all the Sky Deutschland shareholders and raised £3.25 billion through a bond financing last week.

In theory, BSkyB, in which Fox has a 39% stake, could use some of that cash for other acquisitions.BSkyB shares today dipped 2.5p to 873.5p.