Justice Department will not block Liberty Media’s DirecTV deal
A spokeswoman for the Justice Department said that an investigation into the $12-billion deal did not find support for any action against the transaction. A spokesman for Liberty Media said earlier in the week that the company expects the deal to close shortly after gaining the necessary regulatory approvals.
The Justice Department’s announcement followed Monday’s news that the Federal Communications Commission (FCC) voted in favor of allowing Liberty Media to acquire News Corp.’s controlling stake in DirecTV.
While saying that allowing the deal to go forward was in the best interest of the public, the FCC also stipulated that Liberty Media and DirecTV abide by program access and other requirements that it had previously imposed on News Corp. in order to preserve competition.
The FCC did require that business relationships between Liberty Global’s Liberty Cablevision of Puerto Rico and DirecTV come to an end within a year. Liberty Global is a spin-off from Liberty Media.
As part of its authorization of the deal, the FCC did not require that DirecTV add local, over-the-air broadcast stations in a timely fashion in all 210 of its metropolitan markets, despite broadcast TV groups requesting that it do so.
Liberty Media, founded by cable pioneer John Malone, made a deal in December 2006 to trade its 16.3 percent ownership of stock in Rupert Murdoch’s News Corp. in return for News Corp.’s 38.5 percent stake in DirecTV (story here). The deal calls for the swap of shares between the two companies, in addition to $550 million in cash and three regional sports networks from News Corp. to Liberty Media.
DirecTV is the nation’s largest satellite provider with about 16 million subscribers, and the deal gives Malone his first domestic presence since the sell off of TCI to AT&T in 1999.
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