The £18bn merger between US media giant 21st Century Fox and Sky is likely to come under scrutiny after the secretary of state for culture, media and sport said she was “minded to” refer the deal to the regulator Ofcom.
Karen Bradley raised concerns over broadcasting standards and said the deal might risk putting control of the media into the hands of the few.
She has asked Fox and Sky to submit evidence and will report back later this month
“I can confirm that formal notification for the proposed merger of Sky and 21st Century Fox was lodged with the European Commission today and I have written to the parties to inform them that I am minded to issue a European intervention notice on the basis that I have concerns that there may be public interest considerations that are relevant to this proposed merger that warrant further investigation,” Ms Bradley said.
Should the minister issue an intervention notice, this would trigger an investigation by Ofcom and possible scrutiny by the Competition and Markets Authority.
“This is not an announcement of my final decision in relation to intervention, but an indication of what I am presently minded to do,” Ms Bradley said.
Sky and Fox have until 5pm on March 8 to submit written evidence to the minister.
"Any decision to intervene is not the end of the matter,” Ms Bradley warned, suggesting a complicated and drawn-out process could lie ahead.
Fox, which is controlled by the Murdoch empire, already owns 39pc of Sky, but is hoping to gain full control.
The media dynasty attempted a takeover of Sky five years ago under the News Corp banner, but this was scuppered by political fallout from the phone hacking scandal.
The Murdochs' British newspapers and their stake in Sky were at the time part of the same company, which triggered an Ofcom investigation.
News Corp has since been split into Fox and 'new' News Corp, which owns newspapers and other publishing assets.
Sky already has three Fox executives on its board including James Murdoch, who is Sky's chairman as well as chief executive of Fox.
In January, Fox and Sky started lobbying MPs about plans for the controversial merger, in the hope of staving off political opposition to full Murdoch control of Britain's dominant pay-TV operator and avoid a potentially fraught appearance in front of the culture committee.
Many MPs have warned that the deal could dilute competition and lead to editorial changes at Sky News.
Fox News, the Murdochs’ US news channel, is seen as highly partisan. British broadcasters face strict Ofcom impartiality rules, although in January Sky executives told The Telegraph that changes to Sky News that made it more similar to American news channels were already under way.
A spokesperson for 21st Century Fox said: "As we have previously indicated, we anticipate regulators will undertake a thorough review of the transaction, and we look forward to engaging with them as appropriate. We believe the combination of 21st Century Fox and Sky will create a company best suited to compete in a rapidly evolving industry, and are confident that the transaction will be approved based on a compelling fact set.”
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