Big firms gun for Communications Bill deal boost

City law firms have welcomed publication of the Communications Bill by the government as a catalyst for merger activity.

The Bill - which paves the way for non-EU companies to take ownership of ITV, and the scrapping of tight regulation preventing cross-ownership of print and broadcast media - is likely to unleash a flurry of mergers if it becomes law.

Denton Wilde Sapte media specialist Michael Ridley said the announcement could prove the catalyst for the long-rumoured merger between Granada and Carlton.

He said firms with media expertise and the magic circle will all be hoping to scoop work both in the run-up to enactment - anticipated next year - and the aftermath.

At Clifford Chance - with a 240-lawyer media group and contacts with US investment banks through US merger partner Rogers & Wells - the firm is looking to win deals.

Partner Daniel Sandelson said: 'I never underestimate the competition.

But with deals like this involving securities issues, the City code on takeovers and competition law, I think it is likely that the investment bankers are going to want magic circle firms on board.

I think we'll get a good proportion of it.'

Lindy Golding, a partner in the media department of Lovells - which acts for Granada and hopes to pick up merger instructions - said the Bill would also create opportunities for companies wishing to diversify into radio, such as Guardian newspapers, for which Lovells also acts.

She said: 'If enacted, the Bill will lead to leaner and quicker transactions with less regulatory intervention.'

She said Lovells has already had two instructions on the back of the Bill as many media players are asking for preliminary advice.

Stephen Cooke, head of mergers and acquisitions at Slaughter and May, said deregulation in the media industry was bound to have a positive impact on merger and acquisitions.

He added that there were hopes the market would lift across the board next year, in sectors such as pharmaceuticals and financial services as well as media.

Jeremy Fleming