Britain toughened its stance on Rupert Murdoch’s $15 billion takeover of Sky (SKYB.L) on Tuesday, an unexpected move that sent shares in the pay-TV group down sharply on fears it may be blocked.
Murdoch, 86, and his family have long coveted full control of Sky, despite critics arguing that he controls too much of the British media through his Times and Sun newspapers and the 39 percent he already owns in the broadcaster.
The government had already said it would ask the competition regulator to spend six months deciding whether owning Sky gave Murdoch too much influence over the media.
On Tuesday, it said it was also likely to require an investigation into whether Twenty-First Century Fox (FOXA.O) would uphold broadcasting standards.
“I am now minded to refer the merger to the CMA on the grounds of genuine commitment to broadcasting standards,” Media Secretary Karen Bradley told parliament.
Shares in Sky fell 4 percent on the unexpected twist before recovering slightly to be down 2 percent. Bradley gave Fox and Sky 10 days to respond.
“Following receipt of any representations from the parties I will aim to come to my final decision in relation to both grounds as promptly as I can,” she said.
A previous attempt to take control of Sky in 2011 fell apart due to a phone-hacking scandal at another Murdoch newspaper, the News of the World, that led to a public inquiry and a lengthy criminal court case.
Fox returned with an agreed bid for Sky in December last year.