UK Government Says It Is Ready To Give Fox The Green Light To Purchase Sky

It was on Tuesday that Britain’s government outlined that it was ready to give Twenty-First Century Fox the provisional green light to purchase Sky. An approval could most probably result in a dramatic bidding war with Comcast, which is a U.S. media giant.

State of affairs

Matt Hancock, Culture Secretary, outlined that the proposal by Fox to divest Sky News to Disney or to any other buyer that was worth it could result in the most effective solution in handling of outstanding public interest concerns.

The competing offer that Comcast submitted for Sky in February resulted in Sky’s independent board members withdrawing their recommendation of the offer from Fox. At this point in time, Fox boasts of almost 39% of the European pay-TV group.

A group of British lawmakers are in opposition of Murdoch developing greater influence over the country’s news media. On the other hand, there has been a protracted regulatory process, which has been seeking to disrupt the takeover attempt. When the year started, U.K.’s Competition and Markets Authority proposed the blocking of Fox’s £18.5 billion ($24.7 billion) bid for Sky.

A critical outlook into the matter

It is a matter that is pulling along with major complications according to a person well conversant with the matter. If for instance Murdoch’s Fox floors Comcast, media mogul would only stay at the helm of the company for over a very short period of time. That is because he is a party to a separate $52 billion deal compelling him to sell a significant number of his film and TV assets.

The media landscape has time and again been subjected to a series of takeover proposals over the past few months. The latest developments are taking place at a time when a large number of companies including Netflix and Amazon are sparking about sweeping changes to user’s consumption patterns.

Fox is seeking to provide a series of concessions in a bid to address the concerns of the watchdog. It is making a commitment to release Sky News to Disney but that will be based on the completion of a takeover of Sky.

Mr Hancock opined, “I am optimistic that we can achieve this goal. However, if we can’t agree terms at this point, then I agree with the CMA that the only effective remedy now would be to block the merger altogether. This is not my preferred approach.”

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