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Tuesday 29 January, 2008

Dept Business&Ent

Final DecisionOn BSkyBs stake

Dept for Business, Enterprise & Reg
29 January 2008



29 January 2008


FINAL DECISION ON BSKYB'S STAKE IN ITV


Secretary of State for Business and Enterprise, John Hutton, has today announced
his decision on British Sky Broadcasting Group's acquisition of a 17.9% stake in
ITV plc.  Under sections 54 and 55 of the Enterprise Act, the Secretary of State
has decided:


•   To make an adverse public interest finding taking account of the Competition 
    Commission's decision that this transaction results in a substantial
    lessening of competition within the UK market for all television.


•   To find that the transaction does not have an adverse effect on the relevant 
    specified public interest consideration relating to plurality of persons 
    with control of media enterprises.


•   To impose the remedies recommended by the Competition Commission to
    address the substantial lessening of competition identified in their report:
    divestment of BSkyB's shares in ITV down to a level below 7.5% and
    behavioural undertakings from BSkyB requiring the company not to dispose of
    the shares to an associated person, not to seek or accept representation on
    the Board of ITV and not to reacquire shares in ITV.


The Secretary of State's decisions in this case follow the Competition
Commission's detailed investigation and report into the effects of BSkyB's
shareholding in ITV on competition and on the public interest as it relates to
the need to ensure a sufficient plurality of persons with control of media
enterprises.   In reaching his decision, the Secretary of State also gave
careful consideration to the representations received by him from both the
principal parties and from third parties.

Draft undertakings will be published in due course in accordance with Schedule
10 of Enterprise Act 2002.  This allows for interested parties to comment on the
proposed undertakings.

Notes to editors

 1. On 24 May, the then Secretary of State for Trade and Industry, Alistair
    Darling, referred the acquisition to the Competition Commission (CC) for
    investigation under section 45(2) of the Enterprise Act 2002 (the Act).
    Under its terms of reference the CC was required to prepare a report in
    accordance with Section 50 of that Act containing decisions on whether a
    relevant merger situation had been created; whether that situation would be
    expected to result in a substantial lessening of competition (SLC) in any
    market or markets in the UK; and whether, taking into consideration only any
    SLC and the media public interest consideration specified in the reference,
    the merger may be expected to operate against the public interest.  The
    public interest consideration specified in this case is the one at section
    58(2C)(a) of the Act. This is specified as: 'the need, in relation to every
    different audience in the UK or in a particular area or locality of the UK,
    for there to be a sufficient plurality of persons with control of the media
    enterprises serving that audience'.

 1. The Secretary of State received the final report of the Competition
    Commission, prepared in accordance with Section 50 of the Act, on 14
    December 2007 ('the Competition Commission Report').  This was published on
    20 December 2007.

 2. The Secretary of State published the Competition Commission's report on the
    merger on 20 December 2007 (BERR Press Notice 20007/141).

 3. Under section 120 of the Enterprise Act 2002, any person aggrieved by this
    decision has four weeks within which to apply to the Competition Appeal
    Tribunal for a review of the decision.

 4. The Secretary of State received a request from BSkyB not to disclose to any
    party other than BSkyB the period of time within which the necessary
    divestment of shares is to be completed.  They argued that wider disclosure
    of this information was not necessary and could be unduly prejudicial to
    their legitimate commercial interests.  ITV argued conversely that the
    period should be made public.  The Secretary of State recognises there are
    arguments on both sides.  On balance, having consulted the Competition
    Commission and the Office of Fair Trading about their practice in similar
    cases, the Secretary of State has decided not to disclose the information.
    The specified divestment period will begin from the date that suitable
    divestment undertakings are finalised.

 5. A copy of the final decision can be found at - 
    http://www.rns-pdf.londonstockexchange.com/rns/7190m_-2008-1-28.pdf




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