Murdoch drops bid for BSkyB
0 Comment(s)
Print
E-mail
Agencies via China Daily, July 14, 2011
Rupert Murdoch withdrew his bid for British broadcaster BSkyB on Wednesday in the face of cross-party hostility in parliament following allegations of widespread criminality at one of his tabloid newspapers.
The move came hours before a planned vote in parliament that had all-party support for a non-binding motion urging the Australian-born media magnate to drop a buyout offer which was a major part of his global expansion in television.
"News Corp announces that it no longer intends to make an offer for the entire issued and to be issued share capital of ... BSkyB not already owned by it," the US-listed parent of the global media empire said.
News Corp owns 39 percent of BSkyB, which owns Sky News and a range of profitable pay TV channels.
"It has become clear that it is too difficult to progress in this climate," Deputy Chairman Chase Carey said in a statement, adding that News Corp would remain "a committed long-term shareholder."
Prime Minister David Cameron, who has faced awkward questions about his own relations with Murdoch, welcomed the news: "The business should focus on clearing up the mess and getting its own house in order," he said through a spokesman.
Opposition Labor leader Ed Miliband said it was a victory for those who had opposed the extension of Murdoch's power.
Earlier, Cameron told parliament Murdoch should drop the bid while police investigated allegations that the News of the World hacked the voicemails of thousands of people looking for stories and also bribed police officers for information.
The press baron, who for decades has been both feared and courted by British politicians of all parties, shut down the 168-year-old Sunday tabloid last week in an effort to stem the scandal and save the BSkyB bid. But there was no stopping the flow of allegations and it had looked politically untenable.
Summoning a degree of national unity rarely seen outside times of war, all parties were due to endorse a motion later yesterday in parliament that was to urge Murdoch to drop it.
The four-sentence statement, highlighting News Corp's commitment to BSkyB, leaves the door open to a new offer to buy out the other shareholders at some point in the future, although many months of police investigation and a public inquiry will keep the scandal alive for a good time yet.
Chris Marangi, portfolio manager at Gabelli Multimedia Funds, which holds shares in News Corp, said: "This is not surprising, it doesn't mean the desire's not there. It's politically savvy, and he needs to buy his time and let this blow over ... At the time, it's circle the wagons and protect existing operations."
Several former employees of Murdoch's British newspaper unit News International have been arrested this year after police reopened inquiries which they had dropped in 2007 following the conviction of the News of the World's royal correspondent.
Those under suspicion of hacking and bribing police include former editor Andy Coulson, whom Cameron hired as his spokesman in 2007 after the scandal first broke. Coulson left the prime minister's office in January and denies any wrongdoing.
Go to Forum >>0 Comment(s)