The planned sports broadcasting joint venture (JV) between multinational media and entertainment giant Warner Bros. Discovery (WBD) and UK telecoms giant BT Group is to be investigated by the UK’s Competition and Markets Authority (CMA) regulator, it has today (June 1) been announced.

Last month it was made public that the two companies had agreed to form a 50/50 company to provide a new premium sports offering for the UK and Ireland, transferring BT Group’s BT Sport pay-television business to Warner Bros. Discovery and combining the sports properties of the two.

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However, today's announcement by CMA has indicated that it will be looking into whether the JV would result in “a substantial lessening of competition within any market or markets in the United Kingdom”.

WBD and BT Group were given notice of the inquiry yesterday (May 31) when the process was launched, and a decision about the first phase of the inquiry as outlined above is scheduled to be announced on July 28.

As part of the investigation, the CMA has invited comments on the transaction from any interested party between today and June 17.

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The investigation is the latest in a protracted saga of what will happen to BT Sport after BT Group announced last year that it had appointed investment bank Lazard to assist with the potential sale of a stake of BT Sport and that it was in talks with several interested parties.

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Discovery, prior to its $40+ billion acquisition of WarnerMedia in April, emerged as a suitor in December after DAZN Group, the international sports media company and parent of the over-the-top subscription platform, had been in advanced talks with BT for several months but failed to conclude an agreement.

It was announced at the start of February, that Discovery and BT had entered into exclusive talks to create a JV.

The finalized plans for the deal announced last month would see BT receive £93 million ($117 million) from WBD and up to around £540 million by way of an earn-out, subject to certain conditions being met.

BT would retain a 50% interest in the JV, and Warner Bros. Discovery would be granted a ‘call option’ to buy BT’s interest, exercisable at specified points in the first four years of the tie-up and is subject to certain conditions and arrangements.

It was expected that subject to conditions and regulatory approvals, the deal could be completed by the end of 2022.

BT has subsequently said that the JV is not the first step of a planned exit strategy from the sports market as had been reported and insisted that it will continue to invest in rights and grow its offering.