THE UK government will tomorrow signal that Rupert Murdoch should halt his pursuit of Sky, it revealed yesterday, sending shares in the broadcaster to their lowest level in a year.
Murdoch’s bid to take control of the broadcaster received another blow after David Cameron gave his backing to Ed Miliband’s commons motion against the deal.
The department for culture, media and sport select committee also announced that Rupert Murdoch, his son James and News International boss Rebekah Brooks will all be called to give evidence at a public hearing next week, although it is unclear whether they will attend.
The revelations came after Murdoch momentarily seized the initiative in the ongoing scandal plaguing his media empire by announcing an audacious $5bn (£3.2bn) share buyback programme. News Corp will treble its commitment to return $1.8bn to shareholders over the next 12 months.
The firm will eat into the $10bn of free cash it had earmarked for the Sky deal, in a move that will also consolidate Murdoch’s control of News Corp, assuming he does not sell shares owned by his family trust.
Shares in the media giant rose to $16.50 on the Nasdaq yesterday before settling back to close at $16.08.
Meanwhile RBS cut its target BSkyB price from 900p to 830p after stripping out News Corp synergies – still comfortably ahead of yesterday’s 687p close.