In order to stave off an emergency Parliament vote that could officially squelch the British Sky Broadcasting merger deal that News Corp. CEO Rupert Murdoch is hoping to pull off, News Corp. has changed its bid for BSkyB. The original plan was to spin off News Corp.’s Sky News in exchange for the ability to buy the 61% of BSkyB that the media empire didn’t already own.
The spinoff would have meant that News Corp.’s television holdings in Britain would remain small enough so that the deal didn’t have to go before the country’s independent Competition Commission and instead would just need to be approved by Parliament. That approval looked promising before the News of the World hacking scandal ballooned to include the eavesdropping on phones of murder victims, 9/11 victims, former prime minister Gordon Brown, and also a series of illegal payments to police/Scotland Yard.
In response to the big mess, the minority Labour party called an emergency vote on the BskyB merger for 7/13. So, fearing the deal would be struck down, News Corp. changed its bid: It will no longer spin off Sky News and will take its chances before the nonpartisan Competition Commission rather than take its chances with Parliament.
Although he is avoiding having to deal with Parliament on the BskyB deal, Rupert Murdoch and James Murdoch (Rupert’s son) have still been called (7/12) to appear before the House of Commons to answer questions about the scandal. The summoning from Parliament’s Culture, Media and Sport Committee (which also includes Rebekah Brooks, CEO of News Corp.’s British newspaper division known as News International) is not binding but will increase the growing pressure on the company. No word yet from News Corp. about whether the Murdochs and Brooks would appear.
If bribes are shown to have been made, there could be legal repercussions for News Corp. in the U.S. as well, as we reported.
Meanwhile, Gordon Brown has accused News Corp.’s highbrow London paper — the Sunday Times — of hiring “known criminals” to delve into his private life. It’s been reported that the queen herself was also targeted.