Sky To Be Forced To Reduce ITV Stake

The Commission is set to send its report to the government this week, and according to today’s Financial Times, competition regulators are set to recommend to business and enterprise secretary John Hutton that Sky should reduce its holding from 17.9% to between 5% and 10%.

The conclusions of the report are expected to be published next week, with a final decision made by Hutton in February.

The FT report says that ITV and BSkyB have both received guidance from the Commission that it wants the stake reduced to between 5% and 10%.

Sky paid £940 million for the 17.9% stake in November 2006 and since then the shares have fallen, which means that the satellite broadcaster could be set to lose as much as £190 million from a sale.

In October, the Competition Commission provisionally found that BSkyB’s acquisition by of a 17.9% share in ITV “restricts competition and therefore operates against the public interest” (see Sky Could Be Forced To Sell ITV Stake).

Sky had previously said that it could give up nearly one fifth of its ITV voting rights, so avoiding competition regulations and holding onto its 17.9% share (see Sky Could Give Up Some ITV Voting Rights).