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Court tells Sky to cut ITV stake
BBC News
DATELINE: 21/1/10
The pay-TV group BSkyB has been ordered to reduce its stake in rival ITV by the UK's Court of Appeal. BSkyB lost its appeal to keep the 17.9% share and was told to reduce it to below 7.5%. It bought the stake for £940m in 2006, effectively blocking NTL, now Virgin Media, from buying ITV. The Competition Commission had already ruled that Sky's stake gave it undue influence in the UK media and was not in the public interest.
BSkyB said: "We will review the judgement and order carefully and consider next steps in due course."
The satellite broadcaster has previously argued that it is not breaking UK media ownership laws because the stake is less than 20%. The company maintains the deal was an investment and not designed to stop ITV being bought by rival NTL. The broadcaster has fought to retain its stake since the Competition Commission decided in late 2007 that the purchase could be against the public interest.
Early in 2008 the-then Business Secretary, John Denham, upheld the decision, and the Competition Appeal Tribunal (CAT) did likewise in September 2008. In March 2009 the case went to the Court of Appeal for hearing, leading to the latest court decision.
"After three years of challenges by Sky, the Court of Appeal's decision should now bring this matter to a close, " a Virgin Media spokesman said. "The court's judgement reaffirms the prior rulings... that Sky's 17.9% stake in ITV is anti-competitive. We hope Sky now reduces its stake in ITV without further delay" he added.
Giving his ruling, Lord Justice Lloyd refused permission to take the case to the Supreme Court but Sky can apply directly to that court for a hearing.
Toby Syfret, a media analyst at Enders Analysis, said that BSkyB had lost about £500m on its investment because of the slump in ITV's share price. The firm bought the shares at £1.35 and they now trade at around 58p each. However, Mr Syfret pointed out that if they had been bought to stop NTL's takeover of ITV then the acquisition had served its purpose. "In some ways ITV has benefited from BSkyB's investment because it has stopped other investors coming in. If and when the shares are sold, ITV's future is more uncertain" he added.
Story from BBC NEWS:
http://news.bbc.co.uk/go/pr/fr/-/1/hi/business/8471961.stmLast modified: Thursday, January 21, 2010
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Previous stories
Public Service Broadcasting
Media firms bid for ITV bulletins
Campaigning organisation to continue fight for BBC
BBC sees off plan to use licence fee for regional news on commercial channels
Top-slicing: Kaufman decries 'stupid' legislation
Briefing on Product Placement
TV broadcasting in Northern Ireland under threat
New report shows we can bridge broadcasting funding gap
EU parliament hosts battle on future of public broadcasting
Troubled ITV cuts jobs and costs
MPs' report expected to question BBC and Channel 4 linkup
Government considering options to solve funding crisis at Channel Four
The Slippery Slope of Public Funding: Where Will it End? Now we know:
ITV strike ballot called off
Sertuc conference postponed
Here we go again!
Campaigning for quality television
The future of PSB - postponed
Opting Out
Citizenship and Public Service Broadcasting
How do Ofcom and the BBC Trust see their Roles?
Commission recommends new TV channel for Scotland
Ofcom's 'smash and grab' raid on the BBC licence fee
World Service threatened
Wales, Devolution and Democracy
CPBF responds to Ofcom public service review
NUJ slams 'simplistic' top-slicing arguments
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