Murdoch May Be Close To Agreeing DirecTV Deal

Rupert Murdoch is understood to be on the verge of sealing a deal that would merge his Sky Global Networks business with US’ satellite television company, DirecTV. This in turn could pave the way for a global float of the Sky Global Networks satellite group.

Investors are anticipating the announcement today as Murdoch’s News Corporation unveils its Q2 financial results. However, press reports have also suggested that the deal may yet fall through. Under the terms of the proposed transaction, Sky Global would initially take a 35% stake in Hughes, the company which holds DirecTV and is itself held under ultimate parent company General Motors (GM). Consequently, the boards of News Corp, GM and Hughes must all agree the deal for it go through.

Then, after a proposed sequence of complicated smaller deals, News Corp is expected to emerge as the leading shareholder in the group. This combined group, of which Murdoch would be chairman, is expected to be worth around $70 billion (£40 billion).

There are rumours that GM is still talking to other interested parties, although this may be a ruse to drive up the price of the deal.

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