Murdoch withdraws BSkyB bid

following allegations of widespread criminality at one of his tabloid newspapers.
The move pre-empted by a couple of hours a planned vote in parliament that had all-party support for a non-binding motion urging the Australian-born media magnate to drop a buyout offer which was a major part of his global expansion in television
“News Corp announces that it no longer intends to make an offer for the entire issued and to be issued share capital of . . . BSkyB not already owned by it,” the US – listed parent of the global media empire sa-id.
News Corp owns 39 percent of BSkyB, which owns Sky News and a range of profitable pay-TV channels.
“It has become clear that it is too difficult to progr-ess in this clima-te,” deputy chai-rman Chase Car-ey said in a statement, adding that News Corp would remain “a commi-tted long-term sh-areholder”.
Prime Minister David Cameron, who has faced aw-kward questions about his own re-lations with Murdoch, welcomed the news: “The bu-siness should fo-cus on clearing up the mess and getting its own house in order,” he said through a spokesman.
Opposition Labour leader Ed Miliband said it was a victory for those who had opposed the extension of Murdoch’s power.
Earlier, Cameron told parliament Murdoch should drop the bid while police investigated allegations that the News of the World hacked the voicemails of thousands of people looking for stories and also bribed police officers for information.
The Press baron, who for decades has been both feared and courted by British politicians of all parties, shut down the 168-year-old Sunday tabloid last week in an effort to stem the scandal and save the BSkyB bid. But there was no stopping the flow of allegations and it had looked politically untenable.
Summoning a degree of national unity rarely seen outside times of war, all parties were due to endorse a motion later yesterday in parliament that was to urge Murdoch to drop it. It was unclear if that formal vote would now go ahead, after hours of debate in which hostility to Murdoch was unanimous.
The four-sentence statement, highlighting News Corp’s commitment to BSkyB, leaves the door open to a new offer to buy out the other shareholders at some point in the future, although many months of police investigation and a public inquiry will keep the scandal alive for a good time yet. Chris Marangi, portfolio manager at Gabelli Multimedia Funds, which holds shares in News Corp, said: “This is not surprising, it doesn’t mean the desire’s not there.
“It’s politically savvy, and he needs to buy his time and let this blow over . . . At the time, it’s circle the wagons and protect existing operations.”
Several former employees of Murdoch’s British newspaper unit News International have been arrested this year after police reopened inquiries which they had dropped in 2007 following the conviction of the News of the World’s royal correspondent.
Those under suspicion of phone hacking and of bribing police include former editor Andy Coulson, whom Cameron hired as his spokesman in 2007 after the hacking scandal first broke. Coulson left the prime minister’s office in January and, like other News of the World staff, denies knowing of any wrongdoing.
In the most senior departure from the organisation since Coulson, the legal manager of News International, Tom Crone, has left the company, a source familiar with the matter told Reuters. He has been closely involved in the company’s defence.
That for years consisted of blaming the “rogue reporter” jailed in 2007 but has shifted to accept possibly wider problems since police renewed their investigation under public pressure.
Cameron told a stormy weekly questions session in parliament that Murdoch should drop the bid: “What has happened at the company is disgraceful. It’s got to be addressed at every level and they should stop thinking about mergers when they’ve got to sort out the mess they’ve created.”
Facing new questions about why he hired Coulson, Cameron repeated that he had believed his assurances of innocence. But he warned that his former aide, if found to have lied to him, “should like others face the full force of the law”.
Giving details of a formal public inquiry into the affair, to be chaired by a senior judge, Brian Leveson, Cameron said that senior executives, however high in the Murdoch organisation, should be barred for life from the British media if found to have taken part in any wrongdoing.
Cameron has previously said Rebekah Brooks, Coulson’s predecessor at the News of the World and now Murdoch’s close aide as chief executive of News International, should quit. Brooks has been a frequent guest at Cameron’s country home.
While some analysts said it was too early to declare that his business was in serious retreat in Britain, many said that the sweeping political influence Murdoch had enjoyed over both left and right in politics seemed most suddenly curtailed. – Reuters.