Sky To Launch Its ITV Stake Appeal This Week

BSkyB will this week launch its appeal against the Competition Commission’s ruling that forces it to sell most of its 17.9% stake in ITV.

The appeal comes three weeks after the government accepted the commission’s findings and recommendations, telling Sky it had to sell within a confidential time limit to bring its stake down below 7.5% (see Sky Told To Reduce ITV Stake To Below 7.5%).

Sky is taking up its right to turn to the Competition Appeals Tribunal by February 25 in an attempt to overturn the decision.

According to sources close to Sky, the appeal will relate particularly to the Competition Commission’s report.

It will argue that the commission was wrong from the outset in deciding that Sky’s holding of ITV shares, without Sky having any representation on ITV’s board, created a merger situation worth investigating.

Furthermore, Sky believes it was wrong of the commission to find that its stake had an adverse effect on competition and cites factual evidence that ITV is pursuing a wholly independent strategy without any constraint from Sky.

Thirdly, the appeal will take issue with the recommendation of the commission for Sky to reduce its stake below 7.5%, calling it an “arbitrary figure”. Sky will argue its offer to give up all of its voting rights should have been sufficient to allay the commission’s concern that it could use its holding to block any special resolution proposed by ITV.

BSkyB: 0207 705 3000 www.sky.com ITV: 020 7843 8000 www.itv.com