Karen Bradley, the culture secretary, is “minded” to refer 21st Century Fox’s bid for full control of Sky to the Competition and Markets Authority, setting up a second phase of an investigation into media plurality.
Rupert Murdoch’s 21st Century Fox already owns a 39% share in Sky; however, in December the corporation put in a formal offer of £11.7 billion to buy the remaining 61%.
Although the deal has been cleared by European Commission competition authorities, Ofcom, the UK communications regulator, said that full ownership of Sky would risk increased influence by members of the Murdoch family over the UK news agenda and the political process.
Ofcom, which took 51,000 submissions before reaching its verdict last week, also stated that there were legitimate concerns over media plurality that may justify a reference by the culture secretary to the Competition and Markets Authority.
Acknowledging the “persuasive” arguments made by Ofcom, Bradley said on Thursday these are “clear grounds whereby a referral to a Phase 2 investigation is warranted – so that is what I am minded-to do.”
Bradley is now required by legislation to allow the interested parties the opportunity to make representations to her department on her position before she reaches a final decision – giving them until 14 July to respond.
If the deal eventually goes ahead, it will give Fox control of more than 22 million households across Britain, Ireland, Austria, Germany and Italy, while Sky shareholders will receive £10.75 in cash for each share – valuing the company at £18.5 billion.
Fox originally tried to buy Sky in 2011 but the deal fell through following revelations about the hacking of murdered schoolgirl Milly Dowler’s phone by the Murdoch-owned News of the World.
Responding to Bradley’s announcement, Tom Watson, the shadow culture secretary, said: “the days when citizens from other countries can dominate our media markers whilst paying their taxes overseas have got to end.”
