News Corp withdraws bid for BSkyB
Rupert Murdoch's News Corporation has withdrawn its bid for British Sky Broadcasting Group (LON:BSY), according to a statement released by News Corp this afternoon.
Shares in BSkyB responded initially by plunging below 670 pence each but they had recovered to 690 pence, just two pence down on the day, by 2:50pm.
"We believed that the proposed acquisition of BSkyB by News Corporation would benefit both companies but it has become clear that it is too difficult to progress in this climate," said Chase Carey, News Corporation's chief operating officer. "News Corporation remains a committed long-term shareholder in BSkyB. We are proud of the success it has achieved and our contribution to it."
Doubts about whether News Corporation would be allowed by the British government to proceed with its bid for BSkyB had persisted since the News of the World phone hacking scandal broadened significantly earlier this month, when it emerged that several groups of people may have been victims of the journalists and detectives hacking into their phone accounts.
News International, a subsidiary of News Corp, has since closed down the News of the World - the last edition of which was published last Sunday.
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