UK Culture Secretary Jeremy Hunt said today he intends to accept News Corp's plans to spin off Sky News to address concerns over its planned takeover of BSkyB.
Rupert Murdoch's News Corp is proposing a deal to place the news operation into a separate company, but retain a 39.1% stake in Sky News.
The move comes as News Corp seeks to avoid a full-blown competition inquiry into its plans to buy the 61% of BSkyB it does not already own after Mr Hunt said last month he planned to refer the deal to the Competition Commission.
News Corp is offering to hive off Sky News into a company controlled by independent directors and with an independent editorial board. It would fund the news channel for 10 years and agree a seven-year licensing agreement for it to use the Sky News name.
Existing BSkyB shareholders will be given an equivalent stake in the new company, but News Corp would not be allowed to increase its 39.1% shareholding for 10 years without permission from the Culture Secretary.
Mr Hunt will consult on the plans until March 21 before making a final decision.
