IF News Corp goes ahead with its £8bn takeover of BSkyB it has agreed to spin off the loss-making Sky News channel as an independent company, which will have its shares publicly traded.
As part of the deal, Rupert Murdoch has agreed to continue broadcasting Sky News for at least 10 years and provide it with a “dowry” during this time – thought to be around £30m a year – to cover its losses.
It is understood News Corp will retain a 39 per cent economic interest and 37 per cent voting interest in the new company. News Corp would license the Sky News brand and allow the news channel to continue using its studios.
The company must remain under the same name for at least seven years. After the decade is up Murdoch may be allowed to buy the channel back.
While Sky will continue to broadcast the channel for 10 years, it is not an exclusive deal, opening up the possibility of Murdoch opening up a Fox News franchise in the UK.
The spun-off firm will have an independent non-executive chairman, while the board will have a majority of independent non-executive directors.
The board will also have approval of the hiring and firing of the editor of Sky News.