Murdoch Will be Told to Slash Sky's Stake in ITV

14 December 2007

LONDON: In the normal course of events, there is but one source from which Clan Murdoch takes orders. So there is a sense of rich expectancy around Britain's media parish pump to see how patriarch Rupert (pictured) reacts to an expected command from the UK Competition Commission.

Word around the pump is that the Clan wil be instructed to slash BSkyB's controversial 17.9% holding in ITV to south of 10%.

Although such a 'request' has yet to be publicly made, moles within the regulator whisper that such a recommendation has been made to John Hutton, the recently appointed secretary of state for Business, Enterprise and Regulatory Reform.

The likes of whom the chieftain of Clan Murdoch regularly substitutes for his breakfast All-Bran.

But time is on Hutton's side. He is not required to publish his ruling before the end of January, leaving time to seek an exit from his moral maze.

It is a Davidian dilemma: to scupper Sky's spoiling stake and risk the electoral hostility of News Corporation which commands 35%-plus of the UK's newspaper readership; or to dilute the disposal command to a token level and incur the wrath of just about everyone else.

The 'sell' instruction, if issued, will be something of a double-whammy for NewsCorp.

Not only would it neuter Sky's power of veto over any undesired ITV merger or alliance (such as that mooted last year by Virgin Media), it would also present NewsCorp with a loss of up to £190 million ($389.38m; €264.85m) caused by the decline in the value of ITV stock.

Data sourced from; additional content by WARC staff