U.K.’s Competition and Markets Authority has submitted their report on 21st Century Fox’s proposed acquisition of Sky to the government. Now Culture Secretary Matt Hancock has 45 days to make a decision as to whether the deal may move forward and what remediation efforts would be have to be made, if any, to address competition concerns. The contents of the report have not been made public. 21st Century Fox proposed purchasing the parts of Sky that they did not own in December 2016. About a year later, Disney made an offer to purchase much of 21st Century Fox, including their Sky ownership stake.
What They Are Saying:
- Culture Secretary Matt Hancock: “My decision will be on whether the merger operates or may be expected to operate against the public interest, taking into account the specified public interest considerations of media plurality and genuine commitment to broadcasting standards. When I have reached a decision I will return to Parliament to make an oral statement. I will come to a view on whether to make a final order or accept any final undertakings in due course, and will consult on these publicly, but not before I have taken a decision on the public interest tests.”
- Neither Sky, 21st Century Fox, nor Disney have commented as of press time.
What is Next:
- May 9: Fox will announce their Q3 earnings and may provide an update on the proposed takeover of Sky.
- By June 13: Culture Secretary will announce his decision regarding the deal to U.K.’s Parliament.
- Ongoing: Sky is continuing to talk to both 21st Century Fox and Comcast regarding takeover efforts. Sky recently withdrew its recommendation for the Fox offer after Comcast made a higher bid.
What This Means for Disney:
- Disney ownership of Sky News or Sky as a whole made become a condition of the transaction.
- Comcast’s offer has created a bidding war that could result in Disney being a minority owner in Sky or having to pay more than anticipated for the service.
- The Disney-Fox transaction is not contingent of the Fox-Sky deal.