Fox commits to Sky News independence in bid to seal takeover

Fox commits to Sky News independence in bid to seal takeover


21st Century Fox (21CF) has offered to strengthen guarantees of Sky News’ independence in an attempt to win regulators’ backing for its takeover of Sky plc, the UK’s biggest pay-television broadcaster.

The US-based media group has tabled a package of what it described as “firewall remedies” to the Competition and Markets Authority (CMA), including a pledge to establish an independent Sky News editorial board that would remain free of any influence by 21CF employees.

21CF would also guarantee the continued funding of Sky-branded news services for at least five years, and would have to disclose any effort to interfere with Sky News’ editorial agenda by 21CF to the Secretary of State for Digital, Culture, Media and Sport.

Documents published by the CMA on Monday revealed the additional safeguards proposed by 21CF as it seeks to bring its 14-month pursuit of Sky to a swift conclusion.

Sky is 39%-owned by 21CF, controlled by the Murdoch Family Trust – which also controls News Corporation, the publisher of British newspapers including The Sun and The Times.

21CF agreed to buy the remaining 61% of Sky in December 2016, since when a string of regulatory obstacles have forced it to extend its timetable for completing the deal.

Last month, the CMA provisionally ruled that the takeover would raise media plurality concerns on the basis that Rupert Murdoch would exert excessive influence over the UK news media.

It raised the prospect of behavioural remedies including the ones disclosed on Monday, or a more far-reaching structural solution such as the spin-off or divestiture of Sky News.

The latest proposals include a so-called ‘sunset clause’ relating to the separate agreement between The Walt Disney Company to buy 21CF’s entertainment assets – including its 39% Sky stake – for $52bn.

Because the larger transaction requires regulatory approval that will not be granted before the CMA must make a final ruling on the takeover of Sky, 21CF has said its independence undertakings relating to Sky News will evaporate if the Disney deal completes.

The Disney-21CF transaction will bring together the 20th Century Fox film studio behind hits such as Avatar, X-Men and Ice Age together with Disney’s film assets, which include Pixar, Marvel and the Star Wars maker LucasFilm.

However, uncertainty relating to that deal has been heightened by reports that Comcast is considering renewing its own pursuit of the 21CF business.

The CMA will make its final decision about the Sky takeover, with a report submitted to Matthew Hancock, the Secretary of State, by May 1.

Opponents of the deal have continued to argue for the deal’s prohibition, including in a joint submission made by politicians including Sir Vince Cable, the Liberal Democrat leader, and Ed Miliband, the former Labour leader.

The National Union of Journalists also called for the takeover of Sky to be blocked in a response to the CMA published on Monday.

(c) Sky News 2018: Fox commits to Sky News independence in bid to seal takeover