OFT takes hard look at BSkyB-ITV deal
EmptyLONDON -- Antitrust body the Office of Fair Trading said Friday it will invite comments on BSkyB's acquisition of a 17.9% stake in ITV, and questioned whether Sky may have acquired "material influence" over the commercial broadcaster as a result of the deal.
The OFT said that, Sky had not exceeded the 20% stake in ITV it was allowed to take under media ownership rules, its acquisition of could amount to a near-merger scenario, and as such would fall foul of the Enterprise Act, a separate piece of competition legislation.
"The OFT believes that it may be the case that a relevant merger situation has been created since Sky and ITV may have come under common control for the purposes of the Enterprise Act 2000 as a result of Sky acquiring material influence over ITV," it said in a statement. "The OFT is, therefore, issuing a formal invitation to comment with respect to the transaction."
The news was welcomed by cable group NTL, which had called on the OFT to act after its own £4.7 billion ($9.2 billion) acquisition bid for ITV was derailed by Sky's sudden move.
"The OFT has confirmed what has always been our view regarding BSkyB's purchase of the 17.9% stake in ITV -- that it was a move intended to give it influence over the future direction and strategy of ITV," an NTL spokesperson said. "In addition, we believe that now is the right time for the DTI to issue an intervention notice and ask Ofcom to carry out a full review of the public interest issues that arise in this case."
Satcaster BSkyB said that ITV management is independent of BSkyB and reiterated the satcaster's "hands-off" approach to the stake.
"ITV has put in place strong, independent leadership and is capable of turning around its performance to the benefit of viewers, employees and all of its shareholders," BSkyB said. "ITV is a good investment for Sky. We note the OFT's provisional finding and will continue to engage fully with the OFT in relation to the enquiry as it moves forward."