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Fox could separate Sky News to satisfy United Kingdom regulator on takeover

Fox could separate Sky News to satisfy United Kingdom regulator on takeover

The proposals are aimed at easing some of the regulatory concerns over the extent of Murdoch's influence on British media if his 21st Century Fox is cleared to buy the 61 percent of Sky it doesn't already own for 11.7 billion pounds ($16.4 billion).

Under the deal described by Fox, Disney would buy Sky News and add it to its existing channel portfolio.

United Kingdom regulators have expressed concerns that if Fox acquires Sky News, Fox chairman Rupert Murdoch will own several of the country's largest media outlets.

Money-losing Sky News is the last regulatory hurdle in 87-year-old Murdoch's long campaign to buy Sky, which has grown from its United Kingdom beginnings to become Europe's biggest pay-TV group.

"The big thing we still don't know is what Comcast are going to do about their potential offer for Sky, which in the short term at least has created a market in Sky shares which is far above the price that 21st Century Fox has offered", he explained.

The company, however, needs to persuade another regulator, the Competition and Markets Authority (CMA), and the government.

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"21st Century Fox (21CF) proposed new ring-fencing remedies which would effect the legal separation between Sky News and the rest of Sky, establishing Sky News as a distinct company within the Sky Group, with its own fully independent board and under the management control of the head of Sky News", it said.

The company said the proposed changes "went above and beyond what Ofcom, the expert, independent regulator on United Kingdom broadcasting, had stated would mitigate concerns around media plurality".

Much of its decision to propose buying Sky News lies in a desire to eventually own Sky, which has 23 million customers and holds lucrative broadcast rights to the English Premier League and other professional soccer leagues.

Sky, which operates in seven European countries, is a smaller version of what American media giants are trying to become: owners of TV and internet "pipes" as well as the programming that flows through them. It agreed late previous year to buy the bulk of Fox's assets - including Murdoch's worldwide broadcasting operations, of which Sky is a part - for $52.4 billion. That was previously uncertain since Disney has argued it could buy Murdoch's 39 percent without making a full bid, because owning Sky wasn't necessarily the main motivation of the wider tie-up between Fox and Disney.

"We have now submitted a new, revised set of remedies should they be considered necessary by the CMA and ultimately by the Secretary of State for Digital, Culture, Media and Sport", Fox said in a statement.