Watchdog opposes mogul's total stock ownership bid
LONDON — Rupert Murdoch is close to securing a deal with U.K.
regulators for his bid to acquire total ownership of U.K. pay box BSkyB.
A report in the Financial Times, published Feb. 25, suggests that an agreement with the Office of Fair Trading is imminent and that a deal could occur as early as next month.
Quoting “people familiar with the process,” the FT claims that News Corp. is “much nearer than previously reported to satisfying objections that combining full ownership of BSkyB with its other assets would reduce the diversity of news provision in Britain.”
The implication is that in order to secure agreement from the British government for the purchase of the 61% of BSkyB stock News does not already own, currently valued at $13.2 billion, the conglom “could cede control” of Sky News.
This would represent a big win for Murdoch, who is worried that any delay to the takeover would see a further hike in BSkyB’s stock price and is therefore keen to avoid a lengthy review by the U.K.
Last year the European Union said there were no grounds to oppose the deal on competition grounds.
However, a report from U.K. communications watchdog, Ofcom, presented to U.K. media minister Jeremy Hunt in December, said that a BSkyB wholly owned by News Corp. could damage media plurality in the U.K.
Ofcom recommended a Competition Commission review, but in late January Hunt gave News time to suggest remedies that would satisfy U.K.
regulators that media plurality would not be damaged by a BSkyB 100% owned by the conglom.