The US firm originally considered buying-out the British broadcaster in 2011...
21st Century Fox said: "The strategic rationale for this combination is clear.
"It creates a global leader in content creation and distribution, enhances our sports and entertainment scale, and gives us unique and leading direct-to-consumer capabilities and technologies.
"It adds the strength of the Sky brand to our portfolio, including the Fox, National Geographic and Star brands."
The 2011 bid was abandoned during Newscorp's phone-hacking scandal.
Rupert Murdoch's son, James, is the chief executive of Fox and the chairman of Sky.