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Sky-Fox takeover deal likely to face competition probe | Sky-Fox takeover deal likely to face competition probe |
(about 4 hours later) | |
The culture secretary has said she is "minded to" refer Rupert Murdoch's 21st Century Fox takeover of Sky to the competition watchdog. | The culture secretary has said she is "minded to" refer Rupert Murdoch's 21st Century Fox takeover of Sky to the competition watchdog. |
Karen Bradley's decision is a blow to the media mogul's hopes of having the £11.7bn deal waved through without further scrutiny. | Karen Bradley's decision is a blow to the media mogul's hopes of having the £11.7bn deal waved through without further scrutiny. |
Mr Murdoch already owns 39% of the satellite broadcaster. | Mr Murdoch already owns 39% of the satellite broadcaster. |
An earlier attempt to take over Sky was abandoned in the wake of the phone hacking scandal. | An earlier attempt to take over Sky was abandoned in the wake of the phone hacking scandal. |
Ms Bradley told the Commons that Ofcom's report into the deal found it risked the Murdoch family having "increased influence" over the UK's news agenda and the political process. | Ms Bradley told the Commons that Ofcom's report into the deal found it risked the Murdoch family having "increased influence" over the UK's news agenda and the political process. |
"On the basis of Ofcom's assessment, I confirm that I am minded to refer to a phase two investigation on the grounds of media plurality," she said. | "On the basis of Ofcom's assessment, I confirm that I am minded to refer to a phase two investigation on the grounds of media plurality," she said. |
The parties involved can make representations to the culture secretary until Friday 14 July, when she will make a further decision about referring the deal to the Competition and Markets Authority. | The parties involved can make representations to the culture secretary until Friday 14 July, when she will make a further decision about referring the deal to the Competition and Markets Authority. |
Ofcom said it had no concerns about Fox's genuine commitment to broadcasting standards, which Ms Bradley said was a second test for approving the deal. | Ofcom said it had no concerns about Fox's genuine commitment to broadcasting standards, which Ms Bradley said was a second test for approving the deal. |
As a result she told MPs she was "minded not to refer" the bid for a phase two investigation in relation to those concerns. | As a result she told MPs she was "minded not to refer" the bid for a phase two investigation in relation to those concerns. |
"While there are strong feelings among both supporters and opponents of this merger, in this quasi-judicial process, my decisions can only be influenced by facts, not opinions - and by the quality of evidence, not who shouts the loudest," she said. | "While there are strong feelings among both supporters and opponents of this merger, in this quasi-judicial process, my decisions can only be influenced by facts, not opinions - and by the quality of evidence, not who shouts the loudest," she said. |
Tom Watson, the shadow culture secretary, told the Commons that "nothing about this decision is a surprise" as he predicted the government would eventually allow the merger to go ahead. | Tom Watson, the shadow culture secretary, told the Commons that "nothing about this decision is a surprise" as he predicted the government would eventually allow the merger to go ahead. |
He said if James Murdoch, who is both chairman of Sky and chief executive of Fox, could pass a "fit and proper" test, "then that says more about the rules than it does about Mr Murdoch". | He said if James Murdoch, who is both chairman of Sky and chief executive of Fox, could pass a "fit and proper" test, "then that says more about the rules than it does about Mr Murdoch". |
"It's clear that the rules need to be reviewed and if the current Conservative government won't do that then the next Labour government will." | "It's clear that the rules need to be reviewed and if the current Conservative government won't do that then the next Labour government will." |
'Condemned' | 'Condemned' |
Mr Watson said undertakings from the Murdoch family were "not worth the newsprint they are written on" as he warned that lessons had not been learned from the phone-hacking scandal. | Mr Watson said undertakings from the Murdoch family were "not worth the newsprint they are written on" as he warned that lessons had not been learned from the phone-hacking scandal. |
He also accused the Conservatives of forming "an implicit bargain" with the Murdochs as he pushed Ms Bradley to order part two of the Leveson Inquiry into phone-hacking. | He also accused the Conservatives of forming "an implicit bargain" with the Murdochs as he pushed Ms Bradley to order part two of the Leveson Inquiry into phone-hacking. |
The culture secretary claimed Mr Watson was making a "cynical" attempt to politicise the issue and to prejudge the decision. | The culture secretary claimed Mr Watson was making a "cynical" attempt to politicise the issue and to prejudge the decision. |
Evan Harris, executive director of the lobby group Hacked Off, said it condemned Ms Bradley's failure to refer the bid on commitment to broadcasting standards grounds. | Evan Harris, executive director of the lobby group Hacked Off, said it condemned Ms Bradley's failure to refer the bid on commitment to broadcasting standards grounds. |
"The Secretary of State must now begin Leveson part two immediately, and allow that inquiry to report before considering this merger further," he said. | "The Secretary of State must now begin Leveson part two immediately, and allow that inquiry to report before considering this merger further," he said. |
The deal was approved by European Commission competition authorities in April. | The deal was approved by European Commission competition authorities in April. |
Shares in Sky closed 3.3% higher at 988p, valuing the company at almost £17bn. | |
Analysts at Citi said it was possible Fox could find a resolution to Ofcom's concerns before the 14 July deadline and avoid a lengthy inquiry. | |
"Ultimately this is a positive outcome for the Fox/Sky in the sense that it makes deal completion more likely," they said. | |
"Concerns about broadcasting standards would have been almost impossible to work around, while we believe the groups will be able to offer concessions that adequately address concerns about plurality." |