Matt Hancock, who has 10 working days to make a final decision on whether to refer the deal to Ofcom for an investigation, said he is “not minded” to intervene.
In a statement, he said: “Having reviewed the relevant evidence available, I can confirm that I have today written to the parties to inform them that I am minded not to issue an European Intervention Notice on the basis that the proposed merger does not raise concerns in relation to public interest considerations which would meet the threshold for intervention,” he said.
"This is a quasi-judicial decision and I am required to make my decision independently, following a process that is scrupulously fair and impartial, and as quickly as possible."
Government still reviewing Fox-Sky takeover bid
The government is still reviewing a rival £19bn bid from Rupert Murdoch’s 21st Century Fox Inc. (NASDAQ:FOXA) for Sky after receiving the UK Competition and Markets Authority’s report into the deal earlier this month.
Hancock will deliver his verdict on Fox’s 18-month pursuit by June 13.
Last month Sky pulled its recommendation for Fox’s offer to buy the 61% stake in the broadcaster that it does not already own after Comcast swooped in with an improved offer.
Both Fox and Comcast have made a series of pledges with regard to Sky News to get the deal approved.
Comcast, which owns CNBC, NBC Universal and Universal Pictures, has promised to keep Sky’s headquarters in London and guarantee the editorial independence and funding of Sky News for at least 10 years. Comcast also said it would not look to buy a majority interest in any UK newspaper for at least five years.
Fox has said it would give Sky News an independent editorial board and sell the channel to Disney to ease concerns about giving Murdoch too much power over the UK’s media.
Separately, Fox has agreed to sell its entertainment assets to Walt Disney Co (NYSE:DIS).