BSkyB Should Sell ITV Stake

Broadcasting giant BSkyB should sell its 18% stake in ITV, according to the recommendations of the Competition Commission today in their final report on the matter, suggesting that the level of strategic input retained by the company would be contrary to the interests of competition.

The competition regulator suggested that BSkyB should sell off most or all of its share in the company, with minimum options for retaining 7.5% and no directorial input at the ITV board of directors. The report has now been passed on to the UK government, who have the power to make the ruling accordingly, which is thought will see the shares sold off in line with the terms of the document.

The move to acquire the stake in ITV was seen as rather cynical by competitors and many industry insiders, with allegations that it was no more than a ploy to prevent others from taking control of the company and increasing their market share to compete with Sky.

However this has been fiercely denied by the company, who have said they view the acquisition as an investment with the potential to yield long term value returns for their shareholders.

Meanwhile BSkyB and ITV have said they are taking time to study the findings of the report, and are currently awaiting a ruling from the government on the point before taking any further action at this time.

The decision will rest with John Hutton, Business Secretary, who has until the end of January to finalise his decision as to what should happen with the stake in the company. Shares in ITV have traded below value ever since the transaction initially occurred in 2006.

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