News Corp. would pay about $6.6 billion for a 35% controlling stake in Hughes Electronics, parent company of satcaster DirecTV, under terms of a deal nearly completed.
News Corp. plans to buy the 20% of Hughes shares owned by General Motors Corp. and another 15% owned by the public, according to the Wall Street Journal, which cited people close to the matter.
The $6.6 billion translates to about $13.50 per share, a 17.4% premium over Hughes’ $11.50 closing price Tuesday.
Rupert Murdoch, chairman of News Corp., has long coveted DirecTV, which he feels would fit well with other satcasting platforms News Corp. owns in Asia and Europe and would provide a distribution channel in the U.S. for Fox film and TV content. DirecTV would complete a global satellite broadcasting system for News Corp.
Two years ago, Murdoch was outbid for DirecTV by EchoStar, the only major direct-to-home satellite broadcasting competitor to DirecTV. That merger fell apart late last year because of government opposition on antitrust grounds.
In recent weeks, other possible bidders for DirecTV, including telco SBC Communications, have indicated they are not interested, leaving the field open for Murdoch. Liberty Media’s John Malone, who once said he was interested in bidding for the satcaster, has made an investment in News Corp. to help fund a DirecTV purchase.