Sky will review future of Sky News to aid Fox takeover

Sky (LON:SKY) has said it will consider shutting down Sky News if the news channel threatens the blocking of the controversial £11.7 billion deal with 21st Century Fox (NASDAQ:FOX).

The Competition Markets Authority is investigating the deal and has expressed concerns that the finished deal and bigger Murdoch empire could have an impact on media plurality.

In a five-page submission to the CMA, Sky said: “The CMA should not simply assume the ‘continued provision of Sky News’ and its current contribution to plurality, ‘absent the transaction’.

“Sky would likely be prompted to review the position in the event that the continued provision of Sky News in its current form unduly impeded merger and/or other corporate opportunities available in relation to Sky’s broader business,”

The deal has raised many concerns, with Ofgem believing it would leave to media plurality. The Murdochs’ already control the Times, Sunday Times, Sun and Wall Street Journal.

“The proposed transaction would give the Murdoch family trust material influence over news providers with a significant presence on television, radio, printed newspapers and online,” said Ofgem in a report.

Culture secretary Karen Bradley referred the controversial deal to the Competition Markets Authority earlier this year, who have been investigating and will publish findings in December.

The closure of Sky News would be a significant move, with the BBC media editor stating: “It employs hundreds of journalists, it produces world-class material, but it loses tens of millions of pounds, and I think the independent directors of Sky are sending a very clear message… that if they had to choose, maybe they’d prefer for commercial reasons to do the deal with 21st Century Fox rather than continue to fund the losses at Sky News.”

Fox currently owns 39 percent of Sky but is hoping to gain full control of the satellite broadcaster.