NEW YORK: After many months of delicate negotiations, US cable pioneer John Malone has agreed to exchange his contentious shares in Rupert Murdoch's News Corporation empire for the latter's stake in satellite broadcaster DirecTV.
The deal, flagged earlier this month [WARC News: 08-Dec-06], will give the chairman of Liberty Media a 38.5% interest in the number one US satellite company, as well as three regional sports networks and $550 million (€418m; £280m) in cash.
The Murdoch family will take possession of Liberty's 16.3% stake in NewsCorp, an agreement that will safeguard their controlling interest in the media conglomerate.
The deal is expected to be inked mid 2007, following approval from NewsCorp shareholders, US antitrust officials and media watchdog, the Federal Communications Commission.
Malone's interest in News Corp has been a thorn in Clan Murdoch's flesh for more than two years. The family invoked a controversial 'poison pill' anti-takeover device - now expected to be scrapped - to prevent further Liberty predation [WARC News: 12-Nov-04], a move that has continued to anger smaller shareholders.
Liberty is delighted with the deal. Comments president/ceo Greg Maffei: "DirecTV and the regional sports networks represent a critical step in our efforts to transform Liberty Media into a well-positioned, focused operating company."
Data sourced from Financial Times online; additional content by WARC staff