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Murdoch's News Corp In £12bn BSkyB Takeover Bid

Gordon Kelly


Murdoch's News Corp In £8.4bn BSkyB Takeover Bid

Many already associate BSkyB with Rupert Murdoch's News Corporation, but that bond looks set to become vastly stronger...

Contrary to popular opinion Murdoch doesn't have a controlling stake in the broadcaster, but rather a 30.1 per cent shareholding. This isn't likely to last much longer though after news broke that News Crop is looking to buying the remaining 60.9 per cent for a whopping £8.4bn - an offer of 700 pence per share that values BSkyB at £12bn.

Naturally enough BSkyB has rejected the bid therefore obeying the first rule of business: never accept your first offer. It has requested 800p per share and - as always - a deal will be found somewhere in the middle.

"News Corp and the BSkyB Independent Directors have been unable to reach a mutually agreeable price at the current time," said Murdoch's business in a statement. "However, both parties have agreed to work together to proceed with the regulatory process in order to facilitate a proposed transaction and, accordingly, we have agreed to enter into a Cooperation Agreement."

In order words: what I said above - in less words.

As for the larger implications, we'll have to wait and see. Despite not having a controlling share, the 30.1 per cent News Corp has is still by far the largest stake in BSkyB so it has largely run things anyway. How this would change with 100 per cent is unknown, but it would make News Corp by far the biggest media group in the UK with annual revenues of up to £8bn compared to the BBC's £4.6bn. Intimidated yet?

Link: News Corporation Press Release


June 16, 2010, 12:31 am

Gordon: I think the page is broken. Isn't the Darth Vader theme supposed to play when we scroll over Rupert's face?

I only hope the regulators can stop this silliness, and are not prevented from doing so by a government which would be only too happy to let Murdoch rule the country. I'm not holding out much hope though...

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