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    Decision close on Fox's Sky takeover plan

    This is a discussion on Decision close on Fox's Sky takeover plan within the Sky news and announcements forums, part of the SkyUser Announcements category; Decision close on Fox's Sky takeover plan - BBC News Culture Secretary Karen Bradley will reveal whether she plans to ...

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      Decision close on Fox's Sky takeover plan

      Decision close on Fox's Sky takeover plan - BBC News
      Culture Secretary Karen Bradley will reveal whether she plans to refer 21st Century Fox's proposed takeover of Sky for a fuller investigation by 29 June.

      Ms Bradley had asked regulator Ofcom to decide if the deal was in the public interest, especially around media plurality and broadcasting standards.

      Fox wants to buy the 61% stake in the broadcaster that it does not own.

      European Commission competition authorities have approved the deal.

      Both Sky and Fox are controlled by businessman Rupert Murdoch, who also owns the Times and the Sun newspapers.

      Opponents of the $14.8bn (£11.8bn) merger, which would give Fox access to Sky's 22 million customers in Europe, have given evidence to Ofcom in recent weeks and fear the deal would give Mr Murdoch too much control of media in the UK.

      Lawyers representing several women who have accused staff at Fox News - which is part of 21st Century Fox - of sexual harassment, are among those who have spoken to the regulator.

      Former Labour Party leader Ed Miliband and Liberal Democrat MP Vince Cable also oppose the deal.

      Previous attempt


      Ms Bradley was due to receive the reports on 16 May but she extended the deadline to this week because of the general election.

      She can decide to refer the takeover for a fuller investigation by the Competition and Markets Authority.

      In a statement, she said: "My priority remains - as it has throughout this proposed merger - to make my decision independently, following a process that is scrupulously fair and impartial, and as quickly as possible."

      After her statement in Parliament, there will be the chance for representations to be made before a final decision is taken.

      Mr Murdoch has made a previous attempt to take full control of Sky.

      In 2011 News Corp made an offer, but it was abandoned in the wake of the phone hacking scandal.

      Two years later, Mr Murdoch split News Corp into two, with 21st Century Fox taking over the TV and entertainment operations, while News Corp kept the newspaper and publishing businesses.


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      Re: Decision close on Fox's Sky takeover plan

      Murdoch's Sky takeover bid: culture secretary's verdict due this week

      https://www.theguardian.com/business...-due-this-week
      Some analysts believe Ofcom’s investigation into £11.7bn deal has raised concerns but suspect it will get green light six years after earlier bid’s failure

      Rupert Murdoch is about to learn whether the government has cleared his latest bid to buy Sky or whether concerns about competition could yet derail the deal.

      The culture secretary, Karen Bradley, will this week deliver her verdict on whether to greenlight 21st Century Fox’s proposed £11.7bn takeover of the satellite broadcaster, or refer the deal to the competition authorities for further scrutiny.

      Bradley is deliberating on the findings of Ofcom’s investigation into the deal, which include whether the deal will give Murdoch too much control of UK news and whether the media mogul is a “fit and proper” owner.

      The media regulator is also considering whether Fox, which owns the rightwing Fox News channel, will adhere to existing standards of accuracy and impartiality once it takes full control of broadcasting assets including Sky News.

      Bradley has been weighing Ofcom’s findings since last Tuesday and has promised to announce the decision she is “minded to” take by Thursday.

      The culture secretary will then give Fox and other parties an opportunity to have their say over her findings before making a final decision. She can decide to wave the deal through, discuss various options with Fox to address any issues raised by Ofcom, or refer the takeover to the Competition Markets Authority for a lengthy investigation.

      A number of analysts and observers believe that Ofcom’s reports will have raised concerns and issues about the takeover. But they also expect that the Murdochs will probably be able to gain clearance for the deal, six years after withdrawing an earlier bid at the height of the phone-hacking scandal.

      When the proposed takeover was announced last December James Murdoch, the chief executive of Fox and chair of Sky, bullishly said the company would not have to make any “meaningful concessions” to complete the takeover.

      However, since then the Murdochs have come under pressure as allegations of sexual harassment have blown up at Fox News in the US – which have so far claimed the jobs of the late chief executive Roger Ailes, co-president Bill Shine and top presenter Bill O’Reilly.

      They also face the spectre of the phone-hacking scandal, as the Sun faces a new trial later this year.

      During its investigation after Murdoch’s previous attempt to take over Sky, Ofcom found it remained a fit and proper owner of a broadcast licence. However, the regulator published a scathing assessment of James Murdoch, the then chief executive of his father’s newspaper group and chair of Sky, finding that his conduct had repeatedly fallen short of the standards expected. The political fallout saw him stand down as chairman of Sky and decamp for the US to run Fox, the film and TV operation, and rehabilitate his tarnished corporate image.

      A number of observers believe that Ofcom’s report will raise concerns about the issues facing the Murdoch empire, but because there is more distance between James Murdoch and those directly running facing Fox News and the Sun than last time round, ultimately they will pass the “fit and proper” test.

      In recent years the only business to have its licence revoked by Ofcom was adult TV company Bang Media, which runs channels including Tease Me, in 2010.

      Ofcom has also had a chance to air any “fit and proper” concerns about James Murdoch and investigate his role since January, when news broke that he would be returning as Sky chairman and, significantly, following the highly publicised revolt at Sky’s annual meeting when more than 50% of independent shareholders voted against his reappointment.

      Fox currently owns a 39% stake in Sky, and is trying to buy the outstanding 61% of shares. Campaigning groups worry about a potential so-called “Foxification” of Sky News if Rupert Murdoch takes full control.

      In the past decade Fox has notched up 22 breaches of its licence and Ofcom’s codes and rules. Of those, seven were against Fox News, with four last year including against a programme which featured a guest who said that Birmingham was a city “where non-Muslims just simply don’t go”.

      Fox News was taken off air between 5am and 11pm on election day to avoid any issues with Ofcom.

      The company has never had a more serious sanction handed down by Ofcom, unlike UK broadcasters including ITV and the BBC which have both been fined for serious breaches.

      Fox also argues that since the aborted bid in 2010 News Corporation has split into two different companies. Its newspaper assets are in one, News Corp, while its TV and film assets are in the other, with independent boards.

      The company argues that this move neutralises media plurality concerns. During Rupert Murdoch’s previous bid Jeremy Hunt, the then culture secretary, accepted an offer to spin-off Sky News to allay media plurality issues raised by Ofcom.

      Critics of the Murdochs argue that the family will still be the ultimate owner of assets including the Sun, Times and Wall Street Journal as well as Fox News and Sky News that will give them too much control over UK news media.

      Fox also argues that over the past seven years media plurality has exploded with the rise of digital rivals such as Google and Facebook and news distributors and new outlets such as Vice, Buzzfeed and Huffington Post while traditional newspaper sales decline.

      Critics say that plurality issues remain because of the media power Murdoch maintains. In February, it emerged that senior executives from Rupert Murdoch-owned companies met the prime minister or chancellor 10 times in a year – more than any other media organisation.

      And in September, Theresa May had a private meeting with Rupert Murdoch during a flying visit to New York.

      Ofcom’s task to ensure plurality is defined as “preventing any one media owner, or voice, having too much influence over public opinion and the political agenda” and “preventing too much influence over the political process being exercised by any one media owner”.

      Many observers believe that Ofcom’s media plurality report will raise concerns, and that Fox will have to offer up Sky News again.

      However, if Fox does so this time, the company is likely only to offer a legal separation of the business with a separate board and editorial independence guarantees – not a full-scale spinoff. Analysts say that Fox would point to Ofcom accepting BT’s plan to legally separate its subsidiary Openreach to put it at arms’ length as enough of a remedy to address competitors’ concerns over control.

      “In terms of potential remedies, should the issues arise we continue to think Fox could revisit a spinoff of Sky News, as it did with the original bid for Sky in 2010-11,” said Polo Tang, an analyst at UBS, in a recent note to investors. “Separately, James Murdoch could step down as chairman of Sky, but remain chief executive of Fox.”

      The worst case scenario for Fox would be if Bradley says she believes there are plurality or broadcasting standards issues but refuses any remedy offered to push the deal through, instead calling in the Competition Markets Authority.

      The CMA would then have 24 weeks to launch an in-depth investigation that could trigger Fox having to pay a special dividend of about £172m for failing to get the deal done this year. If the deal were to fall through Fox has also guaranteed to pay a break fee of £200m.

      With a weakened Tory government failing to win a parliamentary majority there is also a view that Bradley may go for the safe option of calling in the CMA for full scrutiny.

      “The risk is that the DCMS refers the deal to the CMA as it could be politically expedient to do so,” said Wilton Fry, an analyst at RBC Capital Markets.

      The key questions


      Are the Murdochs “fit and proper” owners of a broadcasting licence for Sky?

      Ofcom is responsible for monitoring all broadcasters to make sure they remain “fit and proper” to hold a broadcasting licence in the UK. Critics argue that phone hacking and scandal at Fox News in the US means that they should fail the test and not be allowed to take full control of Sky.

      Would the deal give the Murdochs too much control of UK news media?

      The Murdochs say the Sun and Times are in a different, independent company, News Corp, to where Sky News would be run at Fox. They add that the rise of media outlets such as BuzzFeed and Huffington Post, against a backdrop of declining newspaper sales, means there is plenty of plurality. Critics argue that the Murdochs effectively still control both companies and that they maintain a huge media influence.

      If the Murdochs take full control of Sky and Sky News, will they adhere to existing standards of accuracy and impartiality?


      There is overlap here with the subject matter of the “fit and proper” test, except in this case it will be up to Bradley, not Ofcom, to decide what action to take on the outcome of the media regulator’s report. In the past decade Fox News has notched up seven breaches of the Ofcom code, a low number with no serious breaches involving fines recorded.
      Comment: What do you think? Should News Corp be allowed to run Sky? Don't forget that Sky now owns Sky Deutschland and Sky Italia, which is larger than when the Murdochs put in the previous bid.

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      Re: Decision close on Fox's Sky takeover plan

      If a takeover would wipe out BT and BT sport then yes.
      It would certainly add more exclusive content across the board going forward to our beloved Sky too.
      I always watch sky news and its the best news channel out there for me, not the 'Labour lefty' driven Beeb, their news is living in the dark ages these days.
      As for Murdoch, that just all washes over me and I often just see it as excuse for those who choose not to have Sky mostly or media outlets that are not part of that successful empire.
      Saying that for The Guardian, that seems a fairly balanced piece for a change.

      By the way a few other overseas broadcasters were asked to silence their election coverage on election day, FOX went off as they were reporting to the US all day on the election day.

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      Re: Decision close on Fox's Sky takeover plan

      Karen Bradley is giving her speech this morning in the House of Commons at 9:30am this morning.
      The actual statement on Sky will be at 11:30am
      http://www.parliament.uk/business/ne...y-fox-and-sky/
      Parliament channel on Sky or watch online Parliamentlive.tv - Guide
      Last edited by lettice; 29-06-17 at 09:16 AM.

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      Re: Decision close on Fox's Sky takeover plan

      Karen Bradley's decision statement;

      Culture Secretary Karen Bradley has told parliament she is “minded” to refer 21st Century Fox’s merger with Sky to the Competition and Markets Authority.

      She said she has to take this decision on a quasi-judicial basis and is bound by the evidence. Her decision cannot be based on her opinions, or on wider political considerations. The decision must be fair and impartial.

      Bradley said Ofcom’s report into the bid raised public interest concerns because of the prospect of the Murdoch family having increased influence over the British media. This justifies a further investigation by the Competition and Markets Authority, she said. She is minded to order that. She has given both Fox and Sky until July 14th to respond.

      If the Secretary does refer the merger the CMA will undergo a further 12-week inquiry into media plurality.

      Bradley told the House that Ofcom’s report said it does not think there are broadcasting standards concerns that would justify a reference to the CMA. She said Ofcom found Fox’s compliance with standards was in line with other broadcasters’.

      The Culture Secretary said Fox has already proposed some undertakings to Ofcom. They proposed setting up a separate editorial board for Sky News and have committed to keeping Sky New with current funding levels for five years.



      Ofcom decided that these remedies would mitigate the plurality risk. Bradley said she has written to the parties saying she is minded not to accept these remedies.

      Bradley has given the parties 10 days to make representations on her “minded to” decisions and stressed these are not her final decisions.

      She also told the House that Ofcom will publish its report later today as to whether the Murdochs are “fit and proper” people to own a TV licence. Bradley said she has seen the report but she would not comment on it, because of her obligations to act in a quasi-judicial role.

      She said it is for Ofcom to decide if broadcasters are “fit and proper”.

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      Re: Decision close on Fox's Sky takeover plan

      Ofcom's statement findings;

      Public interest report
      On 16 March 2017, the Secretary of State for Culture, Media and Sport issued a European intervention notice, which asked Ofcom to report on two public interest considerations around plans by 21st Century Fox to acquire the shares in Sky it does not already own.
      Specifically, Ofcom was asked to consider whether there would be sufficient plurality of persons with control of the media enterprises; and whether the parties would have genuine commitment to the attainment in relation to broadcasting of standards objectives.
      We provided our public interest report on 20 June 2017 to the Secretary of State, who has today published Ofcom’s report.
      https://www.ofcom.org.uk/__data/asse...est-report.pdf
      Our report finds that the proposed transaction raises public interest concerns relating to media plurality.
      It identifies a risk of increased influence by members of the Murdoch Family Trust over the UK news agenda and the political process, with its unique presence on radio, television, in print and online.
      Our report says that we consider that these concerns may justify a reference by the Secretary of State to the Competition and Markets Authority.

      Fit and proper assessment
      Ofcom also has an ongoing duty to be satisfied that broadcasting licensees are fit and proper holders of a licence. This means that we can assess a licensee at any time, on our own initiative, as well as being able to respond to concerns raised by third parties.
      We announced on 6 March 2017 that we would assess Sky’s fitness and properness to hold broadcasting licences in the event of this change of control, and do so within the same timeframe as completing the public interest report. We have published that assessment today.
      https://www.ofcom.org.uk/__data/asse...fit-proper.pdf
      Ofcom has considered allegations of sexual and racial harassment at Fox News that are extremely serious and disturbing. It seems clear that there were significant failings of the corporate culture at Fox News. In order to have a concern about fitness and properness, we would need to see evidence of misconduct in the parent company, Fox. However, we have no clear evidence that senior executives at Fox were aware of misconduct before it was escalated to them in July 2016, after which action was taken.
      We have concluded that the overall evidence available to date does not provide a reasonable basis for Ofcom to conclude that, if Sky were 100% owned and controlled by Fox, it would not be a fit and proper holder of broadcast licences. Our assessment finds that Sky would remain a fit and proper licence holder in the event of the merger.
      As fitness and properness is an ongoing duty, we can re-examine our position if new evidence comes to light.

      Secretary of State’s announcement

      The Secretary of State has today said that, on the basis of Ofcom’s assessment, she is minded to refer to a Phase 2 investigation on the grounds of media plurality. The Secretary of State added that the parties have until 14 July to make representations before she reaches a final decision.

      https://www.ofcom.org.uk/about-ofcom...fox-sky-merger
      Full list of the related Ofcom reports available here;
      https://www.ofcom.org.uk/consultatio...t-test-sky-fox

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      Re: Decision close on Fox's Sky takeover plan

      Sky's response:

      https://corporate.sky.com/rns.aspx?P...3394fa81dd5579
      RESPONSE TO SECRETARY OF STATE'S ANNOUNCEMENT ON PROPOSED ACQUISITION

      29 June 2017


      Sky plc ("Sky") notes today's announcement by the Secretary of State for Culture, Media and Sport on the proposed acquisition of Sky by 21st Century Fox, Inc. ("21st Century Fox") (the "Transaction"), and publication of Ofcom's report on the public interest considerations.

      Having received Ofcom's report, the Secretary of State has indicated that she is minded to refer the Transaction to the Competition and Markets Authority ("CMA") for an in-depth review in relation to media plurality. The Secretary of State has indicated that she is not minded to refer in relation to commitment to broadcasting standards.

      The Secretary of State has also indicated that she is not presently minded to accept undertakings offered by 21st Century Fox, which provide for the continued editorial independence of and current levels of investment in Sky News.

      The Secretary of State has not reached a final decision. Before reaching a final decision, the Secretary of State will consider further representations. These are to be provided by 14 July, 2017.

      Sky will continue to engage with the process as the Secretary of State reaches her final decision.

      In the meantime, Sky welcomes today's announcement of Ofcom's decision that Sky would continue to be a fit and proper holder of its broadcast licences under full ownership of 21CF and will continue to operate its business as usual.

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