Government refers Fox-Sky deal to competition authorities

Fox-Sky
The proposed Fox-Sky takeover may be referred to the competition authority.

The UK Government have announced their decision to refer the proposed Fox-Sky takeover deal the competition regulation authority.

In a blow to Rupert Murdoch-owned 21st Century Fox, the proposed takeover of British broadcasting service Sky (LON:SKY). 

Back in April, Karen Bradley, the Secretary of State for Culture Media and Sport, announced the government’s decision to extend the investigation into the deal in light of the general election.

On Thursday in the House of Commons, Ms Bradley revealed that Ofcom had concerns that the acquisition might strengthen the Murdoch’s ability to “influence the overall news agenda and their ability to influence the political process and it may also result in the perception of increased influence”.

As a result, Ms Bradley concluded today to MP’s: “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,”.

The involved parties can make submissions to the culture secretary until Friday 14 July, when she will make her final deliberation about referring the deal to the Competition and Markets Authority.

Fox currently holds a 39 percent stake in Sky, which operates UK’s largest digital subscription television company.

Alongside this, Mr Murdoch also operates various other media publications including the Times, Sunday Times and Sun newspapers and the radio group TalkSport, through his umbrella company News Corp.

This one of many Sky takeover attempts by Murdoch-owned NewsCorp, which back in 2010 initiated a takeover which was eventually derailed by investigations into NewsCorp’s News of the World phone hacking scandal.

Despite ongoing investigation in the UK, The European Commission gave their “unconditional approval” for the Fox-Sky deal worth £18.5 billion ($23.2 billion).

Back in December when the deal was announced, Fox had reached the preliminary agreement to purchase the broadcaster for £10.75 per share.

Shares in Sky are currently up 3.45 percent as of 13.26PM (GMT).