Sky News on the line as Murdoch faces obstacles
As UK regulators said 21st Century Fox’s £11.7bn (€13.3bn) bid for Sky would give Rupert Murdoch too much influence over British media, the head of Sky News, John Ryley, called employees to a newsroom meeting to allay concerns about their future.
“I appreciate that today’s announcement does not end a period of uncertainty,” Mr Ryley said in an emailed letter to staff.
“But it is the start of a process, the outcome of which we hope will be a good one for Sky News,” he said.
The roughly 500 employees at Sky News, the UK’s first 24-hour news channel set up by Mr Murdoch in 1989, face an uncertain fate.
The UK’s Competition and Markets Authority (CMA) said the channel might have to be sold or spun off to restrict Mr Murdoch’s sway over British media, while Sky has previously threatened to close the channel entirely if it became an impediment to the Fox deal.
Sky is part of Mr Murdoch’s $52.4bn deal to sell much of his media empire to Walt Disney.
But shares in Sky rose almost 3% as investors said concerns about Mr Murdoch’s influence could still be overcome, for example by spinning off Sky News.
The regulator also indicated it would not object to Disney owning Sky eventually.
Critics of the deal argue that Mr Murdoch could hold sway over the editorial output of Sky’s loss-making news channel.
Sky warned that were the deal to be rejected because of Sky News, it could shut the channel itself.
The initial ruling complicates the separate plan by Walt Disney to buy the majority of Mr Murdoch’s assets, including Sky. Disney had hoped Mr Murdoch, who wants to buy the 61% of Sky he does not already own, would own 100% of the company by the time it completed its takeover.
“We have provisionally found that if the Fox/Sky merger went ahead as proposed, it would be against the public interest,” the CMA’s Anne Lambert said.
Meanwhile, Sky and BT will need to shell out billions of pounds to keep broadcasting the English Premier League and help push rights prices to a record in an auction concluding next month, Ampere Analysis predicts.
The total price for the three-year UK rights to the Premier League is set to reach £5.6bn to £5.9bn, the media consultancy estimates, up 15% from the 2015 auction.
It faces potential new bids from Amazon.com or TV3 owner-Liberty Global.
