UK regulator blocks Murdoch’s £11.7bn takeover of Sky

January 23, 2018

Britain’s competition regulator delivered a blow to Rupert Murdoch on Tuesday, but he’s still in the game. Twenty-First Century Fox’s 11.7 billion pound bid for Sky would give the 86-year-old mogul too much control over UK news, the antitrust authorities said. The deal could nevertheless go ahead.

 

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The Competition and Markets Authority said the deal for the satellite broadcaster would give the Murdoch family “too much control over news providers across all media platforms, and therefore too much influence over public opinion and the political agenda.” The takeover by Mr Murdoch’s 21st Century Fox, the family’s second attempt to acquire Sky, has been superseded by Walt Disney’s $66bn deal to buy Fox’s entertainment assets — including its existing stake in Sky, and UK authorities hinted they would be open to reconsidering their decision once the Disney deal closed.

 

Disney’s takeover of 21st Century Fox would “significantly weaken” the link between the Murdochs and Sky “which is at the root of our provisional concerns about media plurality”, the competition body said, adding that “on the face of it, these concerns would [then] fall away”. But it added that Disney’s acquisition of Fox was likely to be subject to its own regulatory scrutiny and was unlikely to close until well after the review of Fox’s takeover of Sky was complete.

 

The CMA said: The Murdoch Family Trust’s news outlets are watched, read or heard by nearly a third of the UK’s population, and have a combined share of the public’s news consumption that is significantly greater than all other news providers, except the BBC and ITN. While there are a range of other news outlets serving UK audiences, the CMA has provisionally found that they would not be sufficient to moderate or mitigate the increased influence of the Murdoch Family Trust if the deal went ahead. The competition regulator said its investigation had taken into account “serious shortcomings” at the News of the World newspaper, which was at the centre of the phone hacking scandal and which the CMA said “had failed to comply with both press standards and the law”. But it found that the procedures News Corp had put in place to address the problems and that “since then, its newspapers’ record of compliance with press standards does not raise concerns”.

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