Finance

Disney makes move on Sky News to boost Fox bid

Disney makes move on Sky News to boost Fox bid

Disney could acquire Sky News in the United Kingdom to help smooth 21st Century Fox's acquisition of British pay-TV platform Sky.

Fox said in a regulatory filing it has worked "diligently" with Britain's Competition and Markets Authority to come up with proposals that would "safeguard the editorial independence of Sky News" and address the agency's concerns.

In a statement on Tuesday, Disney said the Sky News deal would be "separate from, and not conditional on, Disney's acquisition of Fox".

Complicating matters is the fact that Disney is in the process of negotiating its own £47bn takeover of the majority of 21st Century Fox, including Sky should the deal be progressed. Disney also said it would "agree to sustain the operating capital of Sky News and maintain its editorial independence".

The ringfencing proposal for Sky News now calls for the news operation to be established as an independent company with its own independent board, but with a funding guarantee for 15 years, up from 10 years in a previous offer.

Another proposal is that Sky News would be legally separated from the rest of Sky, in a bid to ensure its editorial independence.

The loss-making news channel has become a key focus of the CMA's investigation into the proposed £11.7 billion takeover of Sky Plc by 21st Century Fox.

"These enhanced remedies went above and beyond what Ofcom, the expert, independent regulator on United Kingdom broadcasting, had stated would mitigate concerns around media plurality".

That could remove a major objection from the CMA, allowing Fox to acquire the 61% of Sky it doesn't already own.

The competition watchdog is expected to give its verdict on the Fox's Sky bid by May 1, leaving the final decision on whether to approve the deal to Culture Secretary Matt Hancock by mid-June.

Fox warned the CMA against accepting "a number of unsupported and fanciful assertions" by "a group of politicians", including Ed Miliband and Sir Vince Cable, who opposed to the deal.

In December, Disney agreed to buy the bulk of Fox's assets, including its film and television studios, for US$52.4bn. However, this offer is now competing with a proposal from the United States cable operator Comcast who put on the table in late February 12.50 pounds per share to take possession of Sky.

"We think Sky is an outstanding company", said Comcast CEO Brian Roberts in a statement at the time. The CMA found the deal would not be against the public interest for broadcasting standards. "A further announcement will be made as and when appropriate", it added.