As Rupert Murdoch arrived at News International's headquarters in
London's Wapping yesterday to contain the crisis, U.K. politicians intensified
calls for a halt of the BSkyB deal, the biggest in News Corp.'s history.
"The first thing he should do is to drop the bid," Labour Party leader
Ed Miliband told BBC Television. Energy Secretary Chris Huhne said Murdoch
should give "his personal assurance" that phone-hacking wasn't done at other
company publications. News International also publishes The Sun,Has anyone done
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News Corp.
hasn't made any decision on whether to withdraw its bid and will continue to
wait for regulatory clearance on the transaction which may come after the summer
recess, said a person familiar with the matter, declining to be identified
because the discussions are private.
Stock Slump
BSkyB dropped 12
percent last week as the four-year-old phone-hacking scandal at Britain's
largest Sunday newspaper escalated, prompting Prime Minister David Cameron to
pledge an independent inquiry. The slump wiped almost 1.1 billion pounds off the
company's market value. At the trading close of 750 pence in London July 8, the
stock is still above the 700-pence- a-share bid News Corp. made a year ago. New
York-based News Corp. fell 7.3 percent last week in Nasdaq Stock Market trading.
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The U.K.offers various beddinges such as pet food, government
doesn't want to approve the BSkyB deal because of the public outrage after the
hacking allegations,We are professional oilpaintingsupplie, said a
person with knowledge of the matter. As the regulatory process has already been
laid out, the only organization that can raise issues with the takeover by News
Corp. at this stage is Ofcom, said the person, declining to be identified
because the discussions are private.
Culture Secretary Jeremy Hunt, who
assumed review of the BSkyB purchase after Business Secretary Vince Cable was
quoted as saying he had "declared war" against Rupert Murdoch, will seek advice
from Ofcom and expects any decision to be significantly delayed, another person
said.
BSkyB's Attraction
News Corp., which already owns 39 percent
of BSkyB, wants full control to gain access to the broadcaster's increasing cash
flow. BSkyB may also help Murdoch make News Corp.'s newspapers more profitable
by allowing him to bundle print and pay-TV subscriptions and spread content over
media platforms.
Analysts project a 28 percent increase in BSkyB's
adjusted per-share earnings in the year ended last month, as more viewers
subscribe to its pay-TV channels. That compares with estimate for a 4 percent
gain at News Corp. BSkyB has more than 10 million U.K. customers for services
that include sports, on- demand TV and high-end international content from
networks such as Time Warner's HBO.
BSkyB was where the younger Murdoch
shined as a manager. He was 30 when he was named CEO in 2003, making him the
youngest chief of a FTSE-100 company. He more than doubled the company's profit
in four years and increased sales by 42 percent as he drove the broadcaster
beyond traditional pay-TV business.
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