Sky ordered to cut stake in ITV

[Dukefever]

http://news.bbc.co.uk/1/hi/business/8471961.stm


Sky have to reduce its stake.

Duke

[Dukefever]

Oops sorry.

Duke

---------- Post added at 10:46 ---------- Previous post was at 10:31 ----------

If it took 3 years to get to this stage how long could the PAY TV saga take after the ruling is made?

I wonder if sky will try make a profit when cutting the stake and who will want to invest in ITV


Duke

[Chris]

Sky have been trying to make a profit by delaying the original instruction to sell for as long as possible. They have been hoping the share price would recover, seeing as they bought at the top of the market and are being ordered to sell at the bottom.

They have failed. Ha ha ha. That'll teach 'em.

[Maggy J]

I'm sure they will re-appeal..

Giving his ruling, Lord Justice Lloyd refused permission to take the case to the Supreme Court but Sky can apply directly to that court for a hearing.

[Dukefever]

How much could they lose then?

[Chris]

About £190 million, if they reduce their stake to 7.5 at today's share price. Plus whatever they've spent on their doubtless very pricey legal team, trying to get the order overturned.

[Mick]

Originally Posted by Dukefever

How much could they lose then?

A lot less than if they had gone with the Competitions ruling back on September 29th 2008. This delay in the appeals process has helped to trim back some significant losses given that the ITV Share price is 41% higher today than it was in Sept 2008.

They will have still made a big loss though overall, they paid around £940,000,000 back in November 2006.

[Sirius]

Originally Posted by Chris

Sky have been trying to make a profit by delaying the original instruction to sell for as long as possible. They have been hoping the share price would recover, seeing as they bought at the top of the market and are being ordered to sell at the bottom.

They have failed. Ha ha ha. That'll teach 'em.

Its made my day as well

[LondonRoad]

Another Sky cockup while the blue-eyed son was at the helm. I wonder if James will be sitting on the naughty step tonight and Daddy Rupert will be deducing a couple of million bucks from his allowance.

[richard1960]

Originally Posted by Chris

Sky have been trying to make a profit by delaying the original instruction to sell for as long as possible. They have been hoping the share price would recover, seeing as they bought at the top of the market and are being ordered to sell at the bottom.

They have failed. Ha ha ha. That'll teach 'em.

It will indeed but it just goes to show how much "excess" cash sky have in their buisiness to throw around,i think sky have really pretty much written off most of this "investment" already without any apreciable effect on the company.

Sky seem to have a load of cash to throw at legal eagles also! Makes me wonder what they could afford to drop the subs by and still make bucketloads.

I had to laugh at this lesson for them though,poor little james no wonder he got shifted so quickly.

[Mick]

I have pressed Virgin Media for a comment over this ruling today and they have stated:

"After three years of challenges by Sky, the Court of Appeal's decision should now bring this matter to a close. The Court's judgement reaffirms the prior rulings of the OFT, the Competition Commission and the Competition Appeal Tribunal that Sky's 17.9% stake in ITV is anti-competitive. We hope Sky now reduces its stake in ITV without further delay."

[Ignitionnet]

Originally Posted by LondonRoad

Another Sky cockup while the blue-eyed son was at the helm. I wonder if James will be sitting on the naughty step tonight and Daddy Rupert will be deducing a couple of million bucks from his allowance.

Oh it's far from a cockup it accomplished exactly what it was intended to, just a case of how much that will cost them.

[Toto]

Which just goes to show that Sky are threatened by what Virgin Media could do to their current premium monopoly.

Nobody believed this was anything more than a blocking tactic, and this latest ruling confirms that. Sky have broken the law, and must now pay for it.

[Ignitionnet]

Originally Posted by Toto

Nobody believed this was anything more than a blocking tactic, and this latest ruling confirms that. Sky have broken the law, and must now pay for it.

Absolutely right, they're just waiting on how much it'll cost them. I would imagine any company in their position would have done exactly the same thing, it's simply good business.

[naeskydish]

The channel 4 link gives further information

http://www.channel4.com/news/article...+stake/3511077

Sky won't have to sell all of their shares at once. It is likely to be given six months to do so, something that will be decided by Business Secretary Lord Mandelson. Ironically, he recently attacked Sky's largest shareholder, Rupert Murdoch's News Corporation, over its partiality.
Rumours in the city are that Sky may sell its stake to Channel Five's owner RTL. Something that I first suggested in 2007, although now unlike then, there are not rumours that it would be a straight forward swap.

I wasn’t aware of RTL’s ownership of channel 5 , so I tried to see if there was some connection between RTL and SKY but there was nothing that jumped out other than RTL showing some SKY channels. However the owner of RTL, Bertelsmann AG itself has got it’s it’s fingers in a few pies not including music or publishing; see http://www.cjr.org/resources/index.php?c=bertelsmann

A read of Bertelsmann on wikipedia is interesting

http://en.wikipedia.org/wiki/Bertelsmann shows;

Bertelsmann is not publicly listed, and is majority owned (76.9%) by the Bertelsmann Foundation, a non-profit organisation and political think tank set up by the founding family Mohn.[2] The remaining 23.1% is owned by the Mohn Family. Albert Frère, a Belgian industrialist, owned 25% of Bertelsmann until 2006.

Bertelsmann currently consists of five corporate divisions and a forthcoming music division:[3]
RTL Group, Europe's biggest broadcaster Gruner + Jahr (a magazine publisher, the biggest in Europe)[4]
Random House, the world's largest trade book publisher (popular literature)
Direct Group, the world's largest book and music club group
Arvato AG, an international media and communications service provider

So although there may be reasons to be pleased about today’s announcement over the ITV shares, it seems to me that companies like Rupert Murdoch’s empire which is not shy at influencing public opinion and a political think giant Bertelsmann AG getting together in business, even in a relatively small way, may eventually be a reason for concern for all free thinkers. I don’t trust them.