Murdoch BSkyB takeover moves closer

Culture Secretary Jeremy Hunt has agreed beefed-up proposals that will see the news station run as an independent company to allay fears that the deal would give Mr Murdoch’s News Corporation too much control of the media.

The consultation has been extended to midday on Friday July 8, after which Mr Hunt will decide whether to wave through the merger once and for all or refer it to the Competition Commission.

News Corp, which also owns the Sun and the Times newspapers in the UK, wants to buy the 61% of shares in the company it does not already own.

It last year offered 700p a share, valuing the company at £12.3 billion, but the board told Mr Murdoch to come back with a higher offer.

The revised plans revealed today by Mr Hunt would make sure that Sky News has an independent director with senior editorial experience and a monitoring trustee to ensure News Corp complies with the deal.

Sky would also have to continue to “cross-promote” Sky News on its channels.

News Corp’s bid has been fiercely opposed by an alliance of rival media firms, including the publishers of the Guardian, the Daily Mail and the Daily Telegraph, who have previously said they were willing to take legal action to block the deal.

The most recent consultation period, which received 40,000 responses, produced no new evidence that caused Mr Hunt to alter his provisional opinion that the merger should go through.

Mr Hunt said: “I am aware of the huge interest in the proposed merger and am grateful to those who responded to the consultation.

“The regulators have confirmed that the proposed undertakings are still sufficient to ensure media plurality.

“I could have decided to accept the original undertakings but a number of suggestions were made in response to the consultation which could further strengthen the undertakings, particularly around editorial independence, business viability and the articles of association.”

Mr Hunt said he had met representatives from several media companies and the global campaign group Avaaz as part of his “careful” consideration of the issue.

Mr Hunt has been summoned to the Commons later this morning to answer an urgent question about the takeover, tabled by Labour MP Tom Watson.

An alliance of media organisations opposed to the deal, including BT, Guardian Media Group, Telegraph Media Group, Trinity Mirror, Northcliffe Media and Associated Newspapers, said they were disappointed with the decision.

A spokesman said: “A number of questions are raised by the remedies which are supposed to limit the impact of this deal on pluralism.

“We continue to believe this matter should have gone before the Competition Commission for a full inquiry.”

The takeover could be given the go-ahead within weeks and attention will now shift to how much News Corp will have to pay to win the approval of BSkyB’s shareholders.

BSkyB’s performance has improved in the year since News Corp made its approach and its share price is currently at nearly 850p, having increased by more than 50%.

Some analysts estimate that it may have to offer at least 950p per share, valuing the company at £16.7 billion - £4.4 billion more than its previous proposal.

The pound has also strengthened against the dollar in the past year, which will add a further £1 billion to the price US-listed News Corp will have to pay.

Mr Murdoch’s plans could be delayed further if online campaign group Avaaz successfully applies for a judicial review of the decision.