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Murdoch drops bid for BSkyB bid

July 14, 2011

LONDON: Media mogul Rupert Murdoch dramatically dropped his bid for control of pay-TV giant BSkyB Wednesday, bowing to pressure from the British government over the phone-hacking firestorm at his newspaper empire.

Rupert Murdoch’s News Corp. has withdrawn its bid for British satellite broadcaster BSkyB in the wake of the growing scandal over newspaper phone-hacking.

Just hours before Britain’s political parties were to back a parliamentary motion urging Murdoch to abandon his long-cherished takeover, his News Corp. conceded it was now “too difficult to progress in this climate”.

The scandal, which forced the closure of the News of the World tabloid on Sunday, also threatened to spread across the Atlantic as key US lawmakers ramped up calls for a US probe into the activities of his business.

British Prime Minister David Cameron welcomed the news about BSkyB, saying the Australian-born tycoon should focus on cleaning up his business, in particular News International, his British newspaper operation.

“This is the right decision. I’ve been saying this company clearly needs to sort out the problems there are at News International and the News of the World — that must be the priority, not takeovers,” Cameron said.

After decades as Britain’s political kingmaker, Murdoch has seen his empire threatened by a wave of outrage over the tabloid’s hacking of voicemails belonging to people including a murdered girl and the families of dead troops.

The 80-year-old Murdoch had pushed for the bid as the broadcaster’s portfolio includes live English Premier League football and blockbuster films, and this year reached its target of 10 million household subscribers.

His decision to axe the 168-year-old News of the World, Britain’s biggest selling Sunday newspaper and a profitable business, was apparently aimed at shoring up the deal, but it failed.

“We believed that the proposed acquisition of BSkyB by News Corporation would benefit both companies but it has become clear that it is too difficult to progress in this climate,” said News Corp. deputy chairman Chase Carey.

-Agencies


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