Berenberg analysts including Sarah Simon were also at the capital markets day. She said “in the end, we heard nothing that fundamentally changed our view”, which was that Sky was overvalued. The shares’ true value, Berenberg said with confidence, was more like 730p.
Over at Bank of America Merrill Lynch they were even more pessimistic than that. In November 2016 Daniel Kerven and his team cut the likely value for Sky shares from 450p to 400p.
The risks was “firmly skewed to the downside in our view, given structural challenges and the risk of a UK consumer squeeze”.
The analysis of both the City and the comedians at Spitting Image came down to this: Sky costs too much.
But things are worth what people are willing to pay. For consumers, £90 a month, say, for access to loads of top sport and movies is worth it.
For Brian Roberts at Comcast, Sky is worth £30 billion.
That price is a reflection of the fact that Sky is a unique asset. There is nothing else like it. And if you’re an American company looking to expand into Europe there is simply no better property than Sky.
Crispin Odey got this. The hedge fund founder said early and often that he thought the winning bid would have to get close to £18 a share (take a bow).
What next? Roberts has already praised Sky’s “accomplished management team”. The risk factor for him must be that this team decides it’s had enough and hops it.
In particular, how Roberts motivates chief executive Jeremy Darroch, who’s just landed £50 million from the deal, is hard to see.
Perhaps the City analysts have got a plan though; perhaps they are keen to offer Roberts some advice.
He might be inclined to consider their input and do the exact opposite.
