Battle for control of Man U
Murdoch's bid to be referred to Monopolies Commission
Posted: Thursday October 29, 1998 02:19 PM
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Many Manchester United fans and lawmakers argue that BSkyB's takeover of Manchester United would create a monopoly Clive Brunskill/Allsport |
LONDON (AP) -- BSkyB's 623-million-pound (US$1 billion) bid to buy Manchester United received a setback Thursday when the government referred the proposed deal for a full investigation by its Monopolies and Mergers Commission.
Trade and Industry Secretary Peter Mandelson issued a statement saying the MMC would decide whether the deal would break the rules of fair trading.
"The decision to a make a reference does not in any way prejudge the question of whether or not the merger would be against the public interest," the statement said. "It is for the MMC to report on this after its investigation."
The MMC is due to issue its findings by March 12.
BSkyB, owned by Australian-born media magnate Rupert Murdoch, had hoped that Mandelson would not hold up the deal by sending it to the MMC.
Many Manchester United fans and lawmakers argue that BSkyB's takeover of Europe's richest club would increase Rupert Murdoch's already huge stake in TV coverage of soccer in Britain and create a monopoly.
One of the leading campaigners against the bid, Manchester United Independent Supporters' Association spokesman Andy Walsh, said the referral gave opponents time to gather more opposition.
"I am absolutely delighted," he said. "This is what we've been working for over the last two months and it's exactly what we wanted.
"The referral to the MMC will give football fans from Manchester United and other clubs the opportunity to discuss for the first time how football should be structured in this country.
"We expect the MMC to look at all aspects of the game, not just the BSkyB-Man United takeover," Walsh said. "Hopefully they will ensure the situation caused by the Sky attempt to take over our club is a thing of the past."
Mark Booth, the American chief executive of BSkyB, and Martin Edwards, chief executive of Manchester United, issued a joint statement on the MMC referral.
"We will put our case strongly to the MMC that the proposed transaction will not operate against the public interest and should be allowed to proceed," the statement said.
"The boards of both companies firmly believe that the acquisition of Manchester United by BSkyB would be good for the club, the players and the fans and will bring together two companies whose skills complement each other and have demonstrated their commitment to football."
Graham Kelly, chief executive of the English Football Association, said the FA opposed the deal on the basis that it would make one club far too powerful compared with the others.
"The FA welcomes Peter Mandelson's decision. Our concerns are widely known," Kelly said.
"There are clearly issues of fairness and, in the public interest, it is to be debated. The referral to the Monopolies and Mergers Commission is the best way for that to happen."
Thursday's announcement comes two days after BSkyB, which exclusively shows live Premier League games in England, said it had not yet won control of the majority of shares.
The satellite broadcasting company said it had received valid acceptances from shareholders representing 33.5 percent of the club's shares.
Combined with shares that BSkyB has been buying directly, the broadcaster has a total ownership just under 45 percent and needs to have more than 50 percent to gain a controlling stake in the club.
Copyright 2003 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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