A&O fights BSkyB's corner in Ofcom takeover inquiry

Ofcom has launched the first public interest inquiry of Allen & Overy client BSkyB following a ministerial intervention, it emerged last week.

Secretary of State for Trade and Industry Alistair Darling asked the media regulator to look into whether or not BSkyB's purchase of a 17.9 per cent stake in ITV last November presented a threat to public interest.

As reported by The Lawyer (22 November 2006), Richard Branson, the largest shareholder in newly formed Virgin Media, has been lobbying hard for arch-rival BSkyB to be investigated. He saw BSkyB's stake as a strategic block to what became a failed bid for ITV by NTL.

Virgin Group has instructed Macfarlanes, while Ashurst and Fried Frank Harris Shriver & Jacobson continue to team up to advise Virgin Media, the company that was formed by the merger between Virgin Mobile and Ashurst client NTL. ITV's advisers are Freshfields Bruckhaus Deringer and Lovells.

Ofcom's inquiry will conclude on 27 April, when Darling will either decide that the purchase can stand or that the matter needs to be referred to the Competition Commission.

Both Virgin Media's and BSkyB's advisers are squaring up in a separate spat in which Virgin Media is disputing how much it should pay for airing BSkyB's basic channels.