The Office of Fair Trading, Britain's competition watchdog, said it is inquiring into British Sky Broadcasting's purchase of a significant stake in commercial broadcast ITV, an Associated Press report said.
The Associated Press report said Sky's purchased a 17.9% stake in ITV in November, effective killing cable company NTL's hopes of taking over ITV.
NTL and its major stockholder, Richard Branson, complained bitterly about the maneuver by Sky, which is controlled by Rupert Murdoch's News Corp.
The Office of Fair Trading said it wasn't interested in whether Sky's stake was intended to block NTL, but whether Sky itself intended to take over ITV, the report said.
Sky has denied any such ambitions.
The agency gave interested parties, including NTL, if it wishes, until January 25 to comment.If the agency decides that Sky is moving toward a takeover, it would then investigate whether the combination would violate competition rules.