UK OFT launches formal investigation into BSkyB'S ITV stake purchase UPDATE |
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Fri, 12 Jan 2007 14:14
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(adding initial response from BSkyB and ITV)LONDON (AFX) - The UK's Office of Fair Trading (OFT) has launched a formal investigation into satellite giant British Sky Broadcasting's recent purchase of a 17.9 pct stake in struggling broadcaster ITV.In a statement, OFT said it will examine BSkyB's shock November move to establish whether it constitutes a are levant merger situation' under the provisions of the 2002 Enterprise Act.If so, OFT said it will then try to determine whether competition in the TV market will be sufficiently reduced to merit an investigation by the Competition Commission.In response, both BSkyB and ITV said in separate statements that they will respond to OFT in 'due course'. BSkyB noted OFT's view was a provisional one.Media regulator Ofcom is also looking into BSkyB's 940 mln stg deal, which effectively scuppered cable group NTL's attempts to buy ITV, to see whether it amounts to a change of control.NTL's largest shareholder, Richard Branson, has repeatedly asked OFT and Ofcom to intervene in what he has termed a 'blatant attempt to distort competition'.Under the UK media industry cross-ownership rules, the Rupert Murdoch-controlled company is not allowed to own more than 20 pct of ITV. Ofcom, however, could ask BSkyB to reduce its holding in its forthcoming report.simon.duke@afxnews.comsd/ks/am/ksCOPYRIGHTCopyright AFX News Limited 2006. All rights reserved.The copying, republication or redistribution of AFX News Content, including by framing or similar means, is expressly prohibited without the prior written consent of AFX News.AFX News and AFX Financial News Logo are registered trademarks of AFX News Limited
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UK OFT launches formal investigation into BSkyB'S ITV stake purchase 