News Corporation hikes bid for BSkyB to £7.8 billion

The board of BSkyB today again rejected a revised offer from News Corp saying it undervalued the company, but that it would support a deal if the offer was in excess of 800 pence a share.

News Corporation, the world's second-largest media conglomerate after The Walt Disney Company, had today hiked its bid to 700 pence for the remaining stake it does not already own in the UK satellite-television company British Sky Broadcasting (BSkyB), after BSkyB rejected its last week's 675 pence a share offer.

"Based on careful review and advice, it is the unanimous view of the independent directors that there is a significant gap between the proposal from News Corporation and the value of the company," said Nicholas Ferguson, senior independent director at BSkyB in a statement today.

The independent directors of BSkyB have indicated that they "would have been prepared to support a proposal if it would deliver value in excess of 800 pence per share.''

But BSkyB said that it was willing to cooperate with News Corp and had signed a cooperation agreement in the interest of shareholders, where News Corp will not make a hostile offer and BSkyB will not to ask for a "put up or shut up notice" from the UK Takeover Panel.

News Corp said that it will pay BSkyB up to £20 million should the deal not be approved by regulators and £38.5 million, if the deal is passed by the regulators and News Corp does not go ahead with the deal.