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British Regulators to Investigate 21st Century Fox’s Deal for Sky British Regulators to Investigate 21st Century Fox’s Deal for Sky
(about 4 hours later)
LONDON — Britain asked regulators on Thursday to investigate whether 21st Century Fox’s $14.3 billion deal to take full control of the British satellite television giant Sky would give the media mogul Rupert Murdoch too much control over the country’s media landscape.LONDON — Britain asked regulators on Thursday to investigate whether 21st Century Fox’s $14.3 billion deal to take full control of the British satellite television giant Sky would give the media mogul Rupert Murdoch too much control over the country’s media landscape.
The takeover for the 61 percent of Sky that 21st Century Fox does not already own was agreed on in December and is the second such effort to combine the two companies since 2011. The latest attempt quickly raised a wave of criticism in Britain, where Mr. Murdoch already holds several media interests.The takeover for the 61 percent of Sky that 21st Century Fox does not already own was agreed on in December and is the second such effort to combine the two companies since 2011. The latest attempt quickly raised a wave of criticism in Britain, where Mr. Murdoch already holds several media interests.
Karen Bradley, Britain’s minister for culture, media and sport, said in a statement to Parliament on Thursday that she had referred the deal to regulators “on the grounds of media plurality and commitment to broadcasting standards.”Karen Bradley, Britain’s minister for culture, media and sport, said in a statement to Parliament on Thursday that she had referred the deal to regulators “on the grounds of media plurality and commitment to broadcasting standards.”
Ms. Bradley said that although 21st Century Fox had contested her position, “none of the representations have led me to dismiss the concerns I have” regarding public interest issues.Ms. Bradley said that although 21st Century Fox had contested her position, “none of the representations have led me to dismiss the concerns I have” regarding public interest issues.
“I am of the view that it remains both important, given the issues raised, and wholly appropriate for me to seek comprehensive advice from Ofcom on these public interest considerations and from the C.M.A. on jurisdiction issues,” she said, referring to Ofcom, Britain’s broadcast and communications regulator, and the Competition and Markets Authority. The two regulators have until mid-May to report back to her.“I am of the view that it remains both important, given the issues raised, and wholly appropriate for me to seek comprehensive advice from Ofcom on these public interest considerations and from the C.M.A. on jurisdiction issues,” she said, referring to Ofcom, Britain’s broadcast and communications regulator, and the Competition and Markets Authority. The two regulators have until mid-May to report back to her.
Along with the investigation in Britain, the merger is expected to face a review by antitrust regulators in the European Union. Sky offers television, broadband and telephone services to nearly 22 million customers in Austria, Britain, Germany, Ireland and Italy. Along with the investigation in Britain, the merger is expected to face a review by antitrust regulators in the European Union. Sky offers television, broadband and telephone services to nearly 22 million customers in Austria, Britain, Germany, Ireland and Italy. It also runs the only commercial 24-hour news channel based in Britain, Sky News. The British Broadcasting Corporation also operates a 24-hour news channel, but it is funded by a license fee.
Concern over Mr. Murdoch’s role in the British media has been a major issue over the years. Concern over the role of Mr. Murdoch and his family in the British media has been a major issue over the years, and the takeover bid has renewed fears about their potentially increasing power in Europe’s media.
In 2011, News Corporation, 21st Century Fox’s predecessor company, made and then withdrew a $12 billion offer for Sky as it was confronted with a controversy over phone hacking by journalists in Britain. Debate will center on the steps required to mollify regulatory concerns, said Martin Moore, the director of the Center for the Study of Media, Communication and Power at King’s College London.
News Corporation, which is now a sister company of 21st Century Fox after the two split, owns the British daily newspapers The Sun and The Times of London, as well as The Wall Street Journal. Mr. Murdoch is executive chairman of both companies. “In the past, they have talked about ways of separating out Sky News,” Dr. Moore said. “There will be lots of discussions made around whether the commitments made around Sky News are adequate.”
In 2011, News Corporation, 21st Century Fox’s predecessor company, made and then withdrew a $12 billion offer for Sky as it was confronted with a controversy over phone hacking by journalists in Britain, which led to one of its newspapers being closed.
That bid in 2011 prompted Ofcom to conduct a “fit and proper” test of whether the people who would be running the company were fit to do so. The review concluded that Sky met the necessary standards, but according to Dr. Moore, its decision this time could be affected by the dual roles held by James Murdoch, Mr. Murdoch’s son who is chief executive of 21st Century Fox and chairman of Sky.
News Corporation, which is now a sister company of 21st Century Fox after the two split, owns the British daily newspapers The Sun and The Times of London, as well as The Wall Street Journal. Rupert Murdoch is executive chairman of both companies.
When 21st Century Fox, which is based in New York, announced the takeover of Sky in December, it said it expected the transaction to close by the end of this year.When 21st Century Fox, which is based in New York, announced the takeover of Sky in December, it said it expected the transaction to close by the end of this year.