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Fox’s Sky deal faces UK regulators

UK media regulator Ofcom will investigate the £11.7bn (US$14.8bn) deal that could see 21st Century Fox taking full control of European satcaster Sky.

Rupert Murdoch

UK culture secretary Karen Bradley referred the deal to the UK media regulator Ofcom to investigate potential public interest concerns.

Ofcom now has until May 16 to explore public interest concerns and has set a deadline of 30 March for submissions relating to the deal. Bradley could then give the deal the all-clear, but if concerns do emerge, Fox will have to address them.

Earlier this month Bradley said she was “minded” to refer the takeover to regulators to explore concerns over Fox’s intentions to maintain broadcasting standards and media plurality.

If the deal goes ahead, Rupert Murdoch will have full control of Sky as well as the UK newspapers that come under his News Corp outfit, including The Times, the Sunday Times and the Sun.

Concerns will also focus on the company’s corporate governance and particularly on James Murdoch, who oversees 21st Century Fox and has served as Sky chairman since January.

James Murdoch

He previously worked across the parent company’s newspaper interests but has lacked widespread shareholder support at Sky of late, requiring Fox support to return him to his position in October.

Sky agreed to sell the remaining 61% of its business not owned by Fox late last year, following a previous attempt aborted in 2011 by owner Rupert Murdoch after the phone-hacking scandal that hit his newspaper empire.

Leading analysts have previously said Fox is likely to succeed in the proposed takeover, with programme licensing and development “synergies” at the heart of the deal.

However, rival broadcasters are also likely to step up efforts to stop the deal, fearing it would hand too much buying power to Murdoch.

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