Moments after Rupert Murdoch’s 21st Century Fox had formally asked the European Union to approve its £11.7B ($14.3B) takeover of pay-TV giant Sky on Friday, the UK government has said it is likely to investigate the acquisition to assess issues of media plurality.
After Fox filed an intent to EU antitrust regulators to take over the 61% of shares in Sky that it does not already own, UK Culture Secretary Karen Bradley indicated that she had “concerns” and was deciding whether to issue a public interest intervention notice. She now has officially 10 working days to decide whether to do so, meaning the deal could be scrutinized by regulatory body Ofcom to investigate issues of media plurality and whether the companies “have a genuine commitment to attaining broadcasting standards objectives.”
“I have, today, written to the parties to inform them that I am ‘minded to’ issue a European intervention notice on the basis that I have concerns that there may be public interest considerations,” said Bradley in a statement released shortly after Fox formally notified the EU of the bid.
“To be clear – I have not taken a final decision on intervention at this stage. In line with the guidance that applies to my quasi-judicial role I am inviting written representations from the parties and will aim to come to a final decision on whether to intervene in the merger within 10 working days of today’s notification.”
She added: “This ground relates to the need for persons carrying on media enterprises and, for those with control of such enterprises, to have a genuine commitment to attaining broadcasting standards objectives. This is not an announcement of my final decision in relation to intervention but an indication of what I am presently minded to do.”
Fox and Sky will have until 5pm GMT March 8 to make their case to the minister and Bradley added that any decision to intervene “is not the end of the matter,” suggesting the process could be a long and drawn-out one. Bradley said she would aim to come to a decision by March 17.
A spokesperson for 21st Century Fox said: “We note the statement issued by the Secretary of State following formal notification of the proposed transaction. As we have previously indicated, we anticipate regulators will undertake a thorough review of the transaction, and we look forward to engaging with them as appropriate. We believe the combination of 21st Century Fox and Sky will create a company best suited to compete in a rapidly evolving industry and are confident that the transaction will be approved based on a compelling fact set.”
Yesterday, 21st Century Fox CEO James Murdoch told delegates at a press event in London that Fox’s takeover of Sky would be “a significant driver of the UK creative industry’s long-term success in the global market.”