BSkyB told to drop out of bid for digital licence
Thursday 19 June 1997
The ITC is thought to have informed BSkyB of the news after a "lengthy submission" from the European Commission suggested that it was anti-competitive. BSkyB, which is 40 per cent owned by Rupert Murdoch's News Corporation, shares control of BDB with Carlton Communications and Granada Group. None of the companies would comment yesterday.
It is thought that the satellite operator is attempting to negotiate control of BDB's programming and subscriber management if it is forced to drop its stake.
However, one source said Granada had threatened to withdraw from BDB completely if BSkyB were not a shareholder. If Granada carried out its threat, BDB's bid would in effect be in tatters. The source said the most likely compromise would be for BSkyB to take a reduced stake in the enterprise.
Although some City analysts suggested Carlton would take a 51 per cent stake in BDB, with Granada being responsible for the rest, others said another party would emerge to take on BSkyB's equity commitment. Cable & Wireless Communications was considered the favourite if Granada and Carlton decided not to split BSkyB's pounds 100m burden two ways.
The ITC refused to confirm the reports, despite pressure from the markets as BSkyB's shares plunged 45p to 521.5p yesterday. A spokesman said merely: "We are still talking to both applicants. No decision has yet been taken." Neither BSkyB nor Digital Television Network, the rival bidder for the digital television licences which is backed by the cable company NTL, would comment last night.
A number of commentators expressed the opinion that the ITC had now almost certainly opened itself to judicial review. The ITC has said in the past that applicants would only be justified in seeking legal redress if there had been "an unfair enhancement of the bid".
Industry observers emphasised that judicial action would be unlikely to work against the ITC, with one commenting: "The ITC has an awful lot of power. It can change its own rules but the bidders can't change the rules themselves."
Although the news battered BSkyB's share price, the stock was said to be suffering in part from Tuesday's announcement that the company's top two executives, Sam Chisholm and David Chance, were to step down at the end of the year.
Alastair Smellie, media analyst at ABN Amro Hoare Govett, said that if BSkyB were to withdraw its equity stake, it would not only be good news for the company itself but for the BDB offering. "BSkyB will still be providing programming to BDB. They just won't be putting up funding," he said. "And if DTN win they'll be able to provide programming for them." However, he warned that the move would not benefit Carlton and Granada commercially, although it would boost their share prices.
filmFilm producers sue Warner Bros for $75m over Hobbit films
sportNapoli 2 Arsenal 0: Gunners must now face either Real Madrid, PSG, Bayern Munich, Atletico Madrid or Barcelona in knock-out stages
Swedish stars ask fans for £195 pledges on crowd-funding website
voicesJust when you thought you could find a man, get married, and have a baby by the age of 35... it turns out you’re too late, says Grace Dent
musicAs Mariah Carey and Noddy Holder rake in the royalties from their classics, why there hasn't been a decent festive hit for 20 years?
theatreAuthor Daniel Rosenthal recalls the mishaps that almost brought the curtain down on the likes of John Gielgud and Diana Rigg
lifeAs the Royal Mail plans to phase out deliveries on two wheels, it's no wonder posties are in a spin
musicThe 21-year-old beat Ella Eyre and Chlöe Howl to win the honour
lifeFull of the joys and want to help your fellow man? December isn't the time to do it
techLuke Blackall reports on precision engineered prams and babygros that monitor your child 24-7
Nelson Mandela memorial: ‘Bogus’ interpreter made mockery of Barack Obama’s tribute in Soweto
David Cameron explains selfie with Obama and Helle Thorning-Schmidt at Mandela Memorial
French café starts charging extra to rude customers
Krokodil in Mexico? Teenager hospitalised after 'injecting drug into her genitals'
Australia incest case: Severely deformed children found in remote farming community after generations of inbreeding
- 1 Nelson Mandela memorial: ‘Bogus’ interpreter made mockery of Barack Obama’s tribute in Soweto
- 2 French café starts charging extra to rude customers
- 3 Sun will 'flip upside down' within weeks, says Nasa
- 4 Is Facebook making us forget? Study shows that taking pictures ruin memories
- 5 Australia incest case: Severely deformed children found in remote farming community after generations of inbreeding
iJobs Money & Business
£77099.84 - £96375.26 per annum + Bonus + Benefits : Harrington Starr: My clie...
£45000 - £60000 per annum + Bonus and Package: Harrington Starr: Trading appli...
£50000 - £60000 per annum + BONUS + BENEFITS: Harrington Starr: A leading prov...
£70000 - £90000 per annum + BONUS + BENEFITS: Harrington Starr: A leading mark...