Rupert Murdoch 'nears green light' in Sky deal
Hopes were rising today in the City that Rupert Murdoch's £9 billion takeover of BSkyB will get the green light from regulators without a lengthy Competition Commission probe.
Culture Secretary Jeremy Hunt is said to be close to a deal with Murdoch's News Corp that would satisfy the Office of Fair Trading and Ofcom after weeks of talks.
An annoucement could reportedly come within days, when Hunt would be expected to put out the proposed "remedy" for consultation for a fortnight.
News Corp, which already owns the Sun and The Times, offered to hive off Sky News into an independent trust last month after Ofcom said a takeover could reduce the plurality of news providers in the UK. Since then, Hunt and the OFT have been discussing further "undertakings" with News Corp to guarantee Sky News' independence.
Hunt will refer the case to the Competition Commission if a remedy cannot be agreed.
Sources close to Hunt played down talk of a deal, saying that the OFT and Ofcom have not reached a conclusion.
Rival media groups fear News Corp could use Sky, which is highly profitable, to cross-sell its newspapers and turn Sky News into a partisan broadcaster like its US cable channel Fox News.
Murdoch is desperate to avoid a further investigation which could take at six months.
News Corp made a 700p-a-share bid for the 61% of Sky it does not already own in June.
Sky's share price has leapt as profits keep rising and the pound has also strengthened against the dollar, pushing up the takeover price for US-based News Corp.
Shares rose 12.5p to 775p in early trading.
News Corp/Sky deal explained
Are UK regulators looking at it on competition grounds?
No. Europe cleared the deal. Sky's dominance and News Corp bundling its newspapers with the pay-TV giant aren't issues. UK regulators are concerned with plurality.
What is plurality?
Having a wide choice of news providers but the definition is vague. The law says "there must be sufficient plurality of persons with control of media enterprises providing news and current affairs to UK-wide cross-media audiences". This is about News Corp, which already owns the Sun and The Times, taking full control of Sky News.
Murdoch owns 39%. Will having 100% harm plurality?
Ofcom says it would. News Corp disputes that and has offered Culture Secretary Jeremy Hunt "undertakings" to guarantee Sky News' independence.
Why not force Murdoch to sell Sky News?
He is proud of it, despite losing many millions of pounds. If he sold, Sky News could shut - harming plurality.
What are the options?
Hiving off Sky News and appointing independent directors. Creating a trust, perhaps funded by a dowry from News Corp, is possible.
