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Sky could be UK election loser

June 9, 2017

Everyone should now be out of the prediction business: Brexit, Trump, and now Theresa May. The UK Prime Minister has seen a Parliamentary majority and a 20 point poll lead disappear and now has to rely on a tiny Northern Ireland party to prop her up.

It is the biggest political disaster wrought by the over-estimation of a British politician of their own ability to deliver the vote since, well, let me see, oh yes since her predecessor called a referendum on Brexit. Now two British PMs in a row have used a national vote with significant consequences for us all to try and solve a problem in their own party. Thanks for that. At least they have both suffered the personal consequences of their arrogance and misjudgement.

Ironically, another victim of their hubris might be the media baron who most enthusiastically backed Brexit and May, despite not being a UK citizen and not living here (or anywhere in Europe). Some commentators are suggesting the Tories’ weakened position means it is much less likely the £11.7 billion Fox/Sky bid will be waved through. A big majority would have meant it more likely that opponents concerns about the ‘fit and proper’ governance of the Murdochs could have been ignored.

In early trading on Friday Sky lost 3.3 per cent of its value. If there is an ‘in depth’ Competition and Markets Authority review, or further concerns on ‘fit and proper’ are put before the Minister, then expect the gap between the bid price and the market to widen. Perhaps the bid will have to be raised; fortunately for Fox, the pound is now so weak this can be done at no real cost. But money can’t buy their way past the regulator or a government on a knife edge that needs support at home more than friends abroad.

Categories: Blogs, Business, M&A, Nick Snow, People, Regulation