Vince Cable intervenes in $11.4 billion bid for 61% share of pay TV platform
LONDON -- British Business Secretary Vince Cable has decided to intervene in News Corp.'s £7 billion ($11.37 billion) bid for the 61% share in BSkyB that it does not already own, referring the deal to the TV regulator Ofcom Thursday.
Cable has instructed British media watchdog to examine the proposed takeover, which values Europe's most successful pay TV platform at £12 billion ($19.5 billion), assuming News Corp. pays £7 per BSkyB share.
He has issued an intervention notice under the Enterprise Act, ordering Ofcom to investigate the news plurality issues relating to proposed takeover, which would result in News Corp. controlling substantial television and newspaper assets including Fox News, Sky News, The Times, The Sunday Times and The News of The World.
A range of media groups including the BBC and a number of newspaper publishers have already objected to the deal, saying it would change the broadcasting news environment here.
A separate series of antitrust investigations relating to the size and scale of the proposed merger deal are being examined by the U.K. Competition and the European Commission, which have begun their own investigations.
"On the basis of the information and submissions available to me, I have decided that it is appropriate to issue an intervention notice in this particular case," Cable said Thursday.
"The independent experts at Ofcom will now investigate and report to me on the media plurality issues that may arise from this proposed acquisition."
Cable has given Ofcom until Dec. 31 to submit a report examining the impact of the proposed acquisition on media plurality in the market and will then decide whether to refer the news plurality issues around the deal to the Competition Commission, triggering a separate CC inquiry.
In a statement, News Corp. appeared relaxed about the news, saying that it was confident that the news plurality issues surrounding the deal were minimal.
"News Corporation is confident that the proposed investment will not adversely affect media plurality in the United Kingdom and looks forward to discussing any substantive issues with the relevant authorities," the company said in a statement.
News Corp. formally notified the European Commission yesterday of its intention to take full control of BSkyB. The Commission will conduct an initial probe into the deal on competition grounds and report back on Dec. 8 with a decision on whether to conduct a longer investigation that would wrap by New Year.