The Fund’s largest detractor for the quarter was SKY Network Television (ASX:SKT). Based in New Zealand, SKY Network Television provides pay-television services, with content ranging from news and sports to movies and pay-per-view events. SKY Network Television’s fiscal first-half earnings were largely in line with analysts’ expectations. However, news that the New Zealand Commerce Commission would not clear the company’s proposed merger with Vodafone New Zealand weighed on SKY’s share price in February and disappointed investors, including us, who believed the merger would benefit shareholders. Although we have reduced our estimate of SKY’s intrinsic value, we continue to remain shareholders, as we believe its standalone business is still trading at a large discount to the company’s true worth.
From the Oakmark International Small-Cap Fund first-quarter 2017 shareholder letter.
