Sky may lose grip on ITV
Big stake has regulator frettingU.K. satcaster British Sky Broadcasting could be forced to sell its 17.9% stake in commercial broadcaster ITV after antitrust regulator Competition the Commission found Tuesday that the ownership interest might be "against the public interest."
Shares in ITV rose 3% to £1.04 ($2.08) on news of the commission's provisional finding. The regulator will now consult on "possible remedies" to its findings that could include forcing BSkyB to sell all or some of its ITV shares. The commission will deliver its final recommendation by Jan. 2, and a decision then will be made by trade minister John Hutton.
"The report published today by the commission has concluded that BSkyB's shareholding in ITV would be likely to lead to a substantial lessening of competition by giving it the ability to influence ITV's strategy," the commission said.
Competition Commission chairman Peter Freeman added that by being ITV's biggest shareholder, BSkyB would have "both the ability and incentive to take advantage of opportunities to weaken ITV or prevent it from taking actions that would threaten BSkyB's interest."
The satcaster issued a neutral rejoinder, saying only that it noted the response and would "continue to engage with the commission during the remainder of this process."
BSkyB stunned the media industry here when CEO James Murdoch launched a lightning raid on ITV shares in November. The move was seen as a bid to block tentative merger talks between ITV and Richard Branson's Virgin Media, then known as NTL.
ITV executive chairman Michael Grade has since warned of the potentially damaging effect of Sky's influence on ITV.
ITV said Tuesday that it welcomed the commission's decision.