In a move which has surprised many in the markets, the provisional ruling from the Competition Commission has indicated that BSkyB’s acquisition of a £940 million stake in ITV (17.9% of ITV) may give the satellite broadcaster too much influence over the long term strategy of the group, although they noted there would be limited day to day influence.

While this ruling is only provisional and not yet set in stone, the final decision may force BSkyB to dis-invest their stake, thereby putting the terrestrial TV company back in “play”.  At the time of the acquisition of the shares there was much criticism from the likes of Virgin TV (who co-incidentally had been thinking of acquiring a stake themselves), hot on the heels of a much covered fall out between BSkyB and Virgin TV. 

Opponents to the move had expressed concern that the purchase was being used to block any potential takeover of ITV, which at the time was very much under pressure.  BSkyB on the other hand argued that they were merely investing in an under valued company.

It will be interesting to see where this investigation leads to, and if BSkyB are forced to sell their stake in ITV.  Quite what would happen to ITV if that were to happen is very much uncertain, but with the backing of a major investor taken away they would be left wide open to a potential takeover - would that be in the interests of the industry?

Posted: October 2nd, 2007 under Mobile Phones.
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