British Regulator Submits New Report to Government on Fox-Sky Takeover

James Lachlan and Rupert Murdoch
Joel Ryan/Invision/AP

The British government confirmed Friday that it had received a new report from communications regulator Ofcom on 21st Century Fox’s bid to take over pay-TV broadcaster Sky.

The report was submitted Friday afternoon to government minister Karen Bradley, who had requested further advice from Ofcom as she considers whether to refer the bid to the U.K.’s Competitions and Markets Authority, a move Ofcom recommended in June. No details of the contents of Ofcom’s new report have been disclosed.

A statement Friday from the Department for Culture, Media and Sport, which Bradley heads, said: “Following the Secretary of State’s request for advice and clarification in light of representations received in relation to the proposed merger between 21st Century Fox and Sky, Ofcom have, today, submitted additional advice to the Secretary of State.”

The statement said Bradley would now “carefully consider that advice before making her decision on referral on the basis of all the evidence before her, and will do so as soon as is reasonably practicable.” Ofcom’s latest report will be be published “in due course.”

European pay-TV operator Sky accepted 21st Century’s Fox’s takeover offer late last year. Fox expected the deal to close in 2017 but has struggled to get it past British authorities, making that timetable unlikely. The agreement has already been approved by European Union officials and in the other territories in which Sky operates: Austria, Germany, Ireland, and Italy.

The U.S. media giant wants to acquire the 61% of Sky it does not already own for $15 billion. Bradley has said she “is minded” to refer concerns over the market share that a combined Fox-Sky would hold to Britain’s competition authority, which would have 24 weeks to carry out a review.

Bradley previously said she was not inclined to further investigate concerns over broadcasting standards and whether the Murdoch family would be a “fit and proper” owner of Sky. But that dismayed opponents of the deal, including prominent British politicians and pressure groups Media Matters and Avaaz, which have highlighted issues at Fox News in the U.S., such as its troubles with sexual harassment and a recent legal complaint related to its reporting on the death of a Democratic Party operative named Seth Rich.

On Monday, Avaaz submitted a letter to Ofcom threatening to have the courts intervene if the regulator did not revisit its June report and “reconsider the question of Sky’s fitness post-merger.” On Wednesday, Media Matters president Angelo Carusone also submitted a letter to Ofcom further arguing against the bid.

Earlier this month, James Murdoch said Fox remained confident of getting the Sky deal past British authorities, but not until 2018 – a delay that would leave the company liable for a hefty penalty payment to Sky shareholders under the terms of the takeover agreement.

Fox’s previous attempt to buy Sky, in 2011, faltered amid Britain’s phone-hacking scandal, in which Murdoch-owned newspapers were found to have illegally intercepted people’s cellphone voicemails. Scandals at Fox News in the U.S. now threaten to derail the latest attempt to buy the pay-TV service.

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