Prime Minister David Cameron’s coalition government will support an opposition Labour Party motion calling for News Corp. to withdraw its bid to take full control of British Sky Broadcasting Group Plc. (BSY)
“We support it,” Cameron’s spokesman, Steve Field, told reporters in London today. “It’s essentially what the prime minister was saying yesterday. The prime minister will support it, the government will support it.”
The Labour motion, to be debated in Parliament tomorrow, reads, “This House believes it is in the public interest for Rupert Murdoch and News Corp. to withdraw their bid for BSkyB.” The debate will finish with a non-binding vote, with the Conservatives, their Liberal Democrats partners and Labour, who between them have 618 seats in the 650-member House of Commons, voting in favor.
News Corp. (NWSA) bought itself time to weather the furor over phone hacking at its now-defunct News of the World newspaper by yesterday pushing Culture Secretary Jeremy Hunt to refer the bid for BSkyB to regulators, which will take at least six months to reach its conclusions.
“They will still be extremely reluctant to write it off,” said Sam Hart, an analyst at Charles Stanley & Co. in London. “In the near and medium term it will be difficult for them to continue to apply pressure if the whole political establishment is against them.”
Labour leader Ed Miliband, who will meet with Cameron and Deputy Prime Minister Nick Clegg this evening to discuss a planned public inquiry into phone hacking, said today there is still a risk the bid is decided on before police finish their investigation into phone hacking. He urged parties to “send a clear signal to Rupert Murdoch about what needs to happen.”
BSkyB shares fell 3.3 percent to 692 pence in London today, below the 700 pence a share News Corp. offered in June last year to take full ownership of the U.K.’s biggest pay-TV broadcaster. It was the sixth consecutive day of declines.
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