Inquiry may stall Murdoch bid

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The Independent Online
RUPERT MURDOCH'S pounds 624m takeover of Manchester United is likely to face a series of investigations which could delay the sale for up to a year.

City analysts believe the mass protests of United fans, coupled with objections from other media and sporting companies, will make it inevitable that the Office of Fair Trading will recommend a monopolies investigation into the world's biggest-ever sports deal

This puts Peter Mandelson, Secretary of State for Trade and Industry, on the spot because he will have to decide whether to accept any OFT recommendation to refer.

He is a close friend of Mr Murdoch's daughter, Elisabeth, general manager of BSkyB. And Mr Mandelson, Tony Blair and other senior Labour figures, spent years wooing the media tycoon to support the party.

In the City, analysts said the pressure on the Trade and Industry Secretary would be irresistible. Tom Usher, an expert in competition law at S. J. Berwin, said: "The OFT is looking at what is best for the consumer and they will have a significant body of complaint. My view is that it is more likely than not to be referred."

The last time Mr Murdoch faced the threat of a Monopolies and Mergers Commission investigation, in the early Eighties over his takeover of Times Newspapers, the then Conservative government decided against a referral.

Confirmation of the takeover sent United shares soaring to 221p on the London stock market, up from an opening price of 200p. At the close of business, however, they settled at 215p, still below the offer price ofabout 240p, following concerns about an MMC referral.

A DTI spokesman said the takeover would be considered by the Department in about four to six weeks and a decision on whether to refer it to the MMC could come within weeks.

It emerged last night that Martin Edwards, the Manchester United chairman, had been prepared to sell to BSkyB at 217p a share but Greg Dyke, a director of the club and of Pearson Television, held out for 240p - an increase in the value of the club of more than pounds 50m.

Sources close to the deal said: "Greg held out until the very end but in the end he went along with it but only having registered his disapproval."

The United board felt the wrath of the club's fans when hundreds protested against the takeover at last night's home game against Charlton.

Earlier in the day, United and BSkyB issued an open letter to fans signed by Mark Booth, chief executive of BSkyB, and Mr Edwards. "BSkyB appreciates that this is a club with a phenomenal heritage, and the most passionate fans in the world," they said. "It is not just another business, it is part of the cultural fabric of Manchester and the nation."

Mr Edwards added: "What we have done today will secure a safe future and a prosperous future for the club. I am not about to do anything that destroys the health and tradition of this club. If I do, I deserve to be strung up."

But Andy Walsh, chairman of the Independent Manchester United Supporters Association, said: "If the club has to be sold we would prefer that it was sold to someone who has some sense for football and preferably a sense of Manchester United.

People's game `dead', page 2

Hatching of the plot, page 3

City applauds deal, page 16