Sky News will be safeguarded for 15 years under a proposal to seal an £11.7billion takeover.
Disney has agreed to buy the channel and fund its future in a move that will clear the way for 21st Century Fox’s purchase of Sky.
The pledge is part of a complicated series of deals which will dictate the satellite broadcaster’s future – and is likely to kick off a multi-billion pound bidding war.
Fox wants to buy Sky, but in turn Disney plans to buy Fox.
Disney has agreed to buy Sky News and fund its future in a move that will clear the way for 21st Century Fox’s purchase of Sky
A new offer for Fox by Disney is expected any day now after rival Comcast, owner of Universal Studios, made a higher bid.
The Government has said it would only approve Fox’s takeover if Sky News was spun off from its parent company.
Regulators say Rupert Murdoch, the chairman of Fox and owner of several UK newspapers, would otherwise gain too much influence over the national media.
As part of the arrangement agreed with Disney, Sky News would continue to operate and be guaranteed funding for at least 15 years – up from a previous guarantee of ten years – Culture Secretary Matt Hancock announced yesterday.
He also said Disney would need permission from the Government to sell the channel during that period.
Hancock added: ‘In my view, these revised undertakings meet the criteria that I set out and will help to ensure that Sky News remains financially viable over the long term, is able to operate as a major UK-based news provider, and is able to take its editorial decisions independently.’
Sky said it welcomed the announcement. The company is weighing up offers from Fox and Comcast, whose higher bid was £22billion.
Disney came forward as the proposed buyer of Sky News after it separately agreed to buy Fox’s entertainment assets – including its holding in Sky – in an all-stock £39billion deal.
Its move has been seen as an attempt to speed up Fox’s takeover of Sky, clearing the way for its own takeover of Fox.
Comcast’s intervention has complicated that plan, however, with its bid for Sky yet to be matched by Fox.
Meanwhile, it has also moved against Disney with a £50billion all-cash counter-offer for Fox – setting the stage for an epic takeover battle over some of Hollywood’s most prized assets.
At stake are Fox’s film and television studios, National Geographic, a 30 per cent stake in video website Hulu, Indian network Star and Fox’s stake in Sky.
Both companies are desperate to acquire Fox’s assets to take on tech giants Netflix, Amazon and Apple.
Today Fox’s executives – including Rupert Murdoch and his sons James and Lachlan – will discuss the competing offers at a company board meeting.