Murdoch back to fill hole in satellite empire. (Media & Technology).News Corp. Chief Executive Rupert Murdoch may get another shot at owning a U.S. satellite-television service after years of failed efforts to enter the market. Investors say they expect Murdoch will make another offer to buy a controlling stake in El Segundo-based Hughes Electronics Corp., owner of the DirecTV satellite service, after regulators last month blocked a proposed purchase of Hughes by rival EchoStar Communications Corp. Speculation about Murdoch's plans only intensified in·ten·si·fy v. in·ten·si·fied, in·ten·si·fy·ing, in·ten·si·fies v.tr. 1. To make intense or more intense: last week with word that News Corp. intends to sell 50 million new shares of its Fox Entertainment Group unit, owner of the Fox television networks and 20th Century Fox film studio, to reduce Fox's debt to News Corp. The new shares, which would be worth $1.33 billion at last week's prices, will reduce News Corp.'s stake in Fox to 80 percent from 85.3 percent, said spokesman Andrew Butcher. "It sets up News Corp. more effectively to make a run at DirecTV," said Scott Mad-dock, who holds News Corp. shares for the $1.7 billion he helps manage at Sagitta Wealth Management Ltd. in Sydney. The sale "strengthens the News Corp. balance sheet" and suggests it's less likely to sell its own shares to fund expansion, Maddock said. EchoStar last year topped News Corp.'s bid to buy Hughes. Investor expectations that Murdoch will damage News Corp.'s finances by taking on debt to buy DirecTV and Italian satellite-TV company Telepiu SpA has hurt News Corp. shares in recent months. The doubts have overshadowed rising ad sales at the company's Fox TV networks that may help boost earnings. "We know Rupert Murdoch is going to own DirecTV," said Hal Vogel, a media analyst and chief executive of Vogel Capital Inc. "The question is how much debt will he incur and what kind of structure he'll put together and whether he'll kill his own balance sheet." Vogel said he sold News Corp. shares "short" in September, seeking to profit from their decline. A Hughes purchase would follow News. Corp.'s agreement in June to buy Italian pay-TV companyTelepiu from Vivendi Universal SA for $1.5 billion in cash and assumed debt. Murdoch had spent more than a year negotiating with Hughes's parent company, General Motors Corp., before EchoStar, owner of the Dish Network See DBS. satellite-TV service, trumped News Corp., offering $30.3 billion in stock, cash and assumed debt. Murdoch's talks with Hughes weren't his first effort to enter the U.S. satellite market. News Corp. and telephone company MCI Communications This article is about MCI before it merged with WorldCom. For other uses, see MCI. MCI Communications was an American telecommunications company that was instrumental in legal and regulatory changes that led to the breakup of the AT&T monopoly of American telephony and Corp. started American Sky Broadcasting in 1996. The companies later decided that competitors had too great a lead in signing up customers and sold American Sky's assets to EchoStar in 1999 without ever starting their service. Murdoch's failure to crack the U.S. market leaves a hole in a portfolio of satellite-TV investments that span the world. Elsewhere, News Corp.'s satellite units include British Sky Broadcasting British Sky Broadcasting (BSkyB — formerly two companies, Sky Television and BSB) is a company that operates Sky Digital, a subscription television service in the UK and the Republic of Ireland. It produces TV content, and owns several TV channels. Group PLC, Stream SpA in Italy, Star TV in Asia and Sky Latin America SKY Latin America refers to two closely related pay-TV providers, one based in Mexico, the other in Brazil. The Mexican company was founded in mid-1996, a joint venture between British Sky Broadcasting (BSkyB), News Corporation, Liberty Media and Grupo Televisa. . "Rupert is probably the world's biggest believer in satellite communications," said Uri Landesman, a principal at Arlington Capital Management. "The only market he's not in is the No. 1 market in the world. Hughes is almost his manifest destiny manifest destiny, belief held by many Americans in the 1840s that the United States was destined to expand across the continent, by force, as used against Native Americans, if necessary. ." Lachlan Murdoch Lachlan Keith Murdoch (born September 8, 1971), is the elder son of media mogul, Rupert Murdoch and the former Anna Torv. He resigned from his executive positions at News Corporation on 29 July 2005. , News Corp.'s deputy chief operating officer Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. , said the company probably won't be approached about bidding for Hughes until at least mid-January, after EchoStar's bid expires. Hughes and EchoStar have said they will offer changes to their agreement to try to appease ap·pease tr.v. ap·peased, ap·peas·ing, ap·peas·es 1. To bring peace, quiet, or calm to; soothe. 2. To satisfy or relieve: appease one's thirst. 3. the U.S. Federal Communications Commission Federal Communications Commission (FCC), independent executive agency of the U.S. government established in 1934 to regulate interstate and foreign communications in the public interest. , which blocked the purchase, and the Justice Department, which sued to stop it. News Corp. probably will bid only for General Motors' stake in Hughes rather than seeking to buy shares held by the public, JBWere Ltd. analyst Brendan Lyons wrote in a research note. Last year, when Murdoch held talks with Hughes, he had planned to form a new publicly traded company publicly traded company A company whose shares of common stock are held by the public and are available for purchase by investors. The shares of publicly traded firms are bought and sold on the organized exchanges or in the over-the-counter market. , Sky Global Networks Inc., which would own Hughes and News Corp.'s other satellite assets. |
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