Government consults on proposals to reduce Sky stake in ITV

Competition Minister Gareth Thomas today published for consultation draft statutory undertakings which, if accepted, would require Sky (British Sky Broadcasting Group plc) to divest a proportion of its shares in ITV.

In January 2008, the Secretary of State announced his decision that Sky's shareholding in ITV should be reduced in order to remedy the substantial lessening of competition the Competition Commission had found arose from Sky acquiring 17.9 per cent of ITV shares.

The undertakings would require Sky to:Divest shares in ITV to a level below 7.5 per cent;
- Agree not to sell shares to persons associated with Sky/News Corporation;
- Agree not to seek or accept representation on the ITV Board; and
- Agree not to reacquire shares in ITV.

Following the Secretary of State's announcement, Sky has sought to appeal the decision via the Competition Appeal Tribunal and Court of Appeal. The Department for Business is today commencing the necessary consultation on these draft undertakings to ensure swift implementation of the remedies should the Secretary of State's decision be upheld by the Court.

The Department is inviting interested parties to submit views on the draft undertakings by Friday 23 January 2009.