News Corp. Withdraws BSkyB Bid
Decision comes hours before Parliament was to debate the planned takeover.
| Posted Wednesday, July 13, 2011, at 9:57 AM ET
Under growing pressure from the British Parliament, Rupert Murdoch’s News Corp. on Wednesday dropped its bid to take full ownership of BSkyB, the United Kingdom’s largest satellite broadcaster.
The announcement comes only hours before Parliament was set to pass a non-binding measure urging Murdoch to drop his $12 billion bid for the 61 percent of BSkyB that his company does not already own.
"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 chairman Chase Carey in a statement to British media.
The move is the latest blow to Murdoch and his media empire. News Corp.’s British newspaper unit, News International, has been implicated in an extensive phone hacking scandal that has already forced the company to shutter The News of the World, a 168-year-old Sunday tabloid, and also led to allegations of similar unethical practices against other Murdoch-owned newspapers in Britain, including The Sun and The Times of London.
Meanwhile, the Wall Street Journal – which itself is owned by New Corp. – reports Wednesday that Murdoch and his top advisers have considered selling off its British newspapers in a bid to stem the fallout from the hacking scandal.
The Journal, citing unnamed sources, says that News Corp. execs have informally explored jettisoning the papers, although given the current economic state of the journalism industry, a deal seems unlikely to develop in the near term. Still, the WSJ reports that the company could revisit the idea in the next six months.
