Australian network Seven said it would attempt to convince the Australian Competition and Consumer Commission, the country’s competition watchdog, that acquiring media investment company Consolidated Media Holdings would not be anti-competitive.
The watchdog has delayed its decision on the proposed takeover of Consolidated, which has a 25-per-cent stake in Australia’s dominant pay-television operator Foxtel and a 50-per-cent stake in pay-television broadcaster Fox Sports Australia, after expressing concerns that Seven could gain an unfair advantage in future sports-rights negotiations.
“We will continue working through the issues with the ACCC in an effort to resolve their concerns,” Seven told the Sydney Morning Herald.
Seven, which currently owns 24 per cent of Consolidated, asked the regulator for clearance to table a counter-offer after the News division of media conglomerate News Corporation agreed a takeover price of A$2 billion (€1.64 million/$2.1 million) for CMH last week. The CMH board said it would support News’s bid in the absence of a higher offer, and a vote on approving the deal is scheduled for October 31.
The regulator said that Seven’s takeover of Consolidated could “create difficulties” for rival broadcasters in their dealings with Fox Sports or Foxtel. “It could have a significant effect on their businesses by making them less competitive in the acquisition of sporting rights,” the watchdog added. “The ACCC considers that the proposed acquisition has the potential to cause a substantial lessening of competition in the free-to-air market by limiting the ability of Seven Network’s rival free-to-air channels to effectively bid for premium sporting rights.”
The regulator invited further submissions from interested parties on Seven’s proposal to take over Consolidated and deferred its decision until October 11.