Comcast Eager for Sky, Executive Says at Morgan Stanley Media Event

Comcast (CMCSA) executive Steve Burke says his company sees a lot of synergies in a merger of Comcast and U.K.-based Sky plc, according to a talk he gave at the Morgan Stanley Technology, Media & Telecom conference in San Francisco on Wednesday, Feb. 28.

Burke said companies like Comcast are at risk of losing out if they don't pursue acquisitions and other forms of expanding operations and finding new audiences.

Burke is the executive vice president of Comcast and president and chief executive officer of NBCUniversal, a Comcast subsidiary.

The company is eager to beat Twenty-First Century Fox (FOXA) to the punch on an acquisition, and came in this week with a $31 billion bid that could edge out Rupert Murdoch's organization. Fox owns 31% of Sky. The Sky stake is part of the vast portfolio of Fox film and television assets that Walt Disney Co. (DIS) is buying for $66 billion.

"Sky is a great business in its own right," Burke said. "The combination of Comcast and Sky can work well."

Burke said both companies have extensive resources in both distribution and content, noting Sky's history of original content production.

Expansion in international markets was also a theme of Burke's talk, and he said Sky's 23 million subscribers in the U.K. and Europe present tremendous growth possibilities. He also claimed his company and Sky have the best set-top boxes available.

He acknowledged that equity markets reacted poorly to news of Comcast's bid. But he noted that the same thing happened with the NBCUniversal deal, which proved profitable in the long run.

"We were the fastest-growing media company over the last seven years."

Burke said Comcast has had double-digit positive cash flow over the last years and is always looking for new opportunities, including social media, theme parks and adjoining hotels.

The company is planning such business operations in Beijing and Shanghai, and it currently manages about 5,400 hotel rooms. "It should be 10,000," he said.

Comcast also did well with the recent Super Bowl, pulling in over $100 million in one evening, he said, adding that the Olympics brought in another $100 million.

Editor's note: This article was originally published by The Deal, a sister publication of TheStreet that offers sophisticated insight and analysis on all types of deals, from inception to integration. Click here for a free trial.

Jim Cramer and the AAP team hold a position in Comcast for their Action Alerts PLUS Charitable Trust Portfolio. Want to be alerted before Cramer buys or sells CMCSA? Learn more now.

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