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News Corp. gets its DirecTV
©Associated Press The deal would give Murdoch access to DirecTV's more than 11-million subscribers and conclude the media titan's three-year effort to gain a U.S. outlet for his global satellite television network. The agreement, approved Wednesday by the board of Hughes' parent General Motors Corp., calls for News Corp. to acquire 34 percent of Hughes. News Corp. would purchase 19.9 percent of Hughes shares owned by GM and offer to buy 14.1 percent of Hughes shares owned by the public. News Corp. would pay about $14 per share, making the deal worth about $6.6-billion. Hughes shares were valued at $11.48 at the close of regular trading Wednesday, before the deal was announced. News Corp. would transfer its interest in Hughes to its Fox Entertainment Group subsidiary, which includes the Fox News Channel. Murdoch, whose News Corp. also owns the Fox network, the Los Angeles Dodgers and other media entities, said the deal will increase competition in the cable markets and give U.S. viewers better services. "We are forging what we believe will be the premier diversified entertainment company in America today," Murdoch said. GM president and chief executive Rick Wagoner said his company "is pleased to have reached an agreement with News Corp. that provides substantial value to our stockholders." Besides DirecTV, Hughes owns 81 percent of the equity in satellite operator PanAmSat and Hughes Network Systems, a broadband satellite network provider. Murdoch first wooed DirectTV in 2001. EchoStar Communications, a rival satellite broadcaster, tried to buy Hughes for $18.8 billion, but that deal was blocked late last year by federal regulators who felt it would harm competition. The News Corp. deal also is subject to regulatory approval. Under the agreement, Murdoch would become chairman of Hughes and Chase Carey, currently an adviser to News Corp., would become Hughes' president and chief executive officer. The company would continue to be based in the Los Angeles suburb of El Segundo.
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From the Times Business report
From the AP
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