UK regulator says £11bn Murdoch takeover of Sky ‘not in public interest’
Competition and Markets Authority says it is set to block Fox/Sky deal but hints it might be happy if Disney owned Fox
The UK’s markets regulator looks likely to block Rupert Murdoch’s Fox from taking full control of broadcaster and broadband operator Sky.
The Competition and Markets Authority (CMA) said this morning that it has provisionally found that the deal – which would have seen Fox pay £11.7 billion to buy the 61% of Sky it doesn’t already own – is “not in the public interest due to media plurality concerns”.
Fox said it was disappointed – but it is unlikely to be surprised. While the inquiry was going on, the future of Fox and its 39% stake in Sky moved to the world of Disney, which has bid $66 billion for its media assets, potentially leading to the break-up of the Murdoch empire.
The CMA notes that “the sale [of Fox assets] to Disney will itself be subject to regulatory scrutiny and it is unlikely to be completed until after the CMA inquiry has concluded. It is therefore uncertain whether, when or how that transaction will be completed.”
That means “the CMA’s analysis of the Fox/Sky transaction cannot take it into account in its assessment of the transaction but implications of the Disney transaction in relation to remedies is considered in the notice of possible remedies”.
The CMA notes, in its list of possible remedies: “Consequently, on the face of it, these concerns would fall away if the Disney/Fox transaction went ahead as announced.”
On the immediate question before it, of the Fox bid for Sky, the CMA said: “Due to its control of News Corp [which owns the Sun, The Times and the Sunday Times newspapers], the Murdoch family already has significant influence over public opinion and full ownership of Sky by Fox would strengthen this even further.”
The Murdoch Family Trust (MFT) controls both Fox and News Corp, but the regulator said it “has provisionally found that Fox taking full control of Sky is not likely to operate against the public interest”.
But it does say the proposed acquisition would lead to the MFT “increasing its control over Sky, so that it would have too much control over news providers in the UK across all media platforms (TV, radio, online and newspapers), and therefore too much influence over public opinion and the political agenda”.
Anne Lambert, who chaired the independent investigation group for the CMA, said: “Media plurality goes to the heart of our democratic process. It is very important that no group or individual should have too much control of our news media or too much power to affect the political agenda.”
The CMA has asked for responses to the possible remedies by 6 February and responses to the provisional findings by 13 February. After that, the CMA is due to confirm its findings to Matt Hancock, the new Secretary of State for Digital, Culture, Media and Sport by 1 May.