News Corp. Defends BSkyB Acquisition Proposal

LONDON: Responding to news that Jeremy Hunt, the U.K.’s Secretary of State for Culture, Olympics, Media and Sport, has referred its proposed takeover of BSkyB to the Competition Commission, News Corporation has called Ofcom’s analysis of the merger "deficient in a number of ways."

British media regulator Ofcom previously raised concerns about News Corp.’s buyout offer for the pay-TV giant. After reviewing Ofcom’s recommendations, Hunt then met with representatives from News Corp. last month and gave the company an opportunity to respond to Ofcom’s concerns. “As a result of these meetings and my consideration of the Ofcom report and subsequent submissions from the parties involved I still intend to refer the merger to the Competition Commission," Hunt said. "On the evidence available, I consider that it may be the case that the merger may operate against the public interest in media plurality."

Hunt said there is no clear timetable for the review of the merger. "My main concern is not to work to an arbitrary timetable but to ensure that I reach my decision in a fair and even-handed way which is transparent and ensures that all concerns are properly considered.”

News Corp. says its plan to take over Sky "will not lead to there being insufficient plurality in news provision in the U.K. The company has put forward extensive and detailed evidence that the level of plurality in the UK has increased since 2003 (when the Communications Act was enacted)—and since the ITV plurality review in 2007 when no concerns were found about the sufficiency of plurality."

The company’s statement continues: "News Corporation believes that Ofcom’s analysis is deficient in a number of ways. While Ofcom acknowledges that the combination of News Corporation and BSkyB would have a minimal impact on consumers and would not enhance News Corporation’s ability to influence the news agenda, it nevertheless concludes that the transaction may be expected to operate against the public interest. News Corporation has made a submission to the Department of Culture, Media and Sport setting out a number of issues with the Ofcom report. However, in the interests of progressing to a transaction, News Corporation has submitted an undertaking that we believe addresses Ofcom’s concerns. We will continue to engage constructively with the regulatory process."

The Sky merger has already been given the greenlight by the European Commission, which concluded that the deal would not impede effective competition.